Robinhood Receives Buy Recommendation: Opportunities through Political Changes

The analysis firm Needham has upgraded its rating of Robinhood stock from "Neutral" to "Buy" and set a price target of $40. Analysts predict that a Donald Trump election victory could significantly benefit the company. In particular, changes at the U.S. Securities and Exchange Commission (SEC) could play into Robinhood's hands. Robinhood, which has so far deliberately limited its product range to avoid conflicts with the SEC, now sees opportunities for further expansion—especially with regard to new crypto assets recently added to the offering. Needham analysts believe that the company is excellently positioned to benefit from the forthcoming expansion of the offering. A bull market driven by retail investors could also play into Robinhood's hands. The company has previously successfully relied on "meme"-based trading products that attract significant interest from retail investors. In addition, the business segments of equities and margin should help mitigate the volatility of crypto revenues and establish Robinhood as a comprehensive financial services provider.