Robinhood Markets Inc (NASDAQ: HOOD) climbed to a multi-year high as Bitcoin soared past the closely watched $100,000 level on Thursday.
The last time its shares traded above $40 was in late 2021.
Investors are primarily responding to the monster rally in BTC this morning – but a massive year-to-date gain of about 250% in HOOD reflects their broader confidence in the company’s ability to expand and grow its profits at a fast clip.
Bitcoin is delivering a significant boost to other crypto stocks like MicroStrategy and Coinbase as well on Thursday.
Bitcoin could double to $200,000 next year
Despite an exceptional rally in Robinhood stock this year, there’s reason to believe that it will push further to the upside next year.
For starters, experts at Standard Chartered are fully convinced that Bitcoin could double to $200,000 by the end of 2025 – a bold forecast that should no longer be surprising considering the asset’s track record.
BTC is up more than 150% for the year at writing.
A Bitcoin price rally is a tailwind for Robinhood shares as it’s typically coupled with higher trading volumes that helps boost the company’s transaction-based revenue. Plus, strength in the crypto market tends to improve investor sentiment towards HOOD as well.
Robinhood stock has a massive TAM
Robinhood stock is an exciting pick to play the expected rally in Bitcoin as its management laid out ambitious targets for the next ten years at the investor day on December 4th.
The neobroker wants to grow by 10 times that “isn’t unthinkable given it has already grown revenue by 10x since 2019,” as per Mizuho analyst Dan Dolev.
Dolev is positive on HOOD as it’s playing in a total addressable market of about $600 billion – roughly 200 times its estimated revenue for the current financial year.
Mizuho’s “buy” rating on Robinhood shares is coupled with a $60 price target that signals potential for another 40% upside from here.
HOOD could rally on international expansion
International expansion may also help Robinhood stock continue to outperform in 2025.
The financial technology company has already disclosed plans of requesting brokerage licenses in Asia and extend its product offerings to potential users in the United Kingdom next year.
HOOD came in shy of Street estimates in its latest reported quarter.
Still, analysts at KeyBanc reiterated their constructive view this morning, saying “product velocity, and the [team’s] confidence in operating efficiency” make Robinhood shares worth owning.
A more accommodative regulatory environment under Donald Trump as the President of the United States will create a favourable operating backdrop that could help extend the momentum in asset/revenue growth as well, the investment firm told clients in its research note.
Robinhood stock does not currently pay a dividend, though.
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