After collapsing approximately 54% from October highs just under $154, Robinhood (NASDAQ: HOOD) stock suddenly rallied 3.69% in the Wednesday, March 25, pre-market from $69.08 at the latest closing bell to $71.63 at press time.
The main driver of the rally came from the decision reached by the online brokerage to approve a $1.5 billion share buyback program over the coming three years. Shiv Verma, Chief Financial Officer of Robinhood, reflected on the decision by stating:
Robinhood is a generational company with a massive long-term opportunity. This authorization reflects the confidence of our management team and board in our ability to continue delivering innovative products for customers and creating value for shareholders while returning capital over time.
The $1.5 billion stock repurchase decision comes after two similar authorizations: one for $1 billion in May 2024 and another for $500 million in April 2025.
Robinhood stock bull case after $1.5 billion buyback is approved
Considering equity buyback programs tend to instill renewed bullishness in investors as they remove some shares from the open market while helping boost prices, Robinhood’s board decision could help end the firm’s long decline.
Additionally, it could help further the already optimistic view regarding HOOD stock already prevalent on Wall Street, where the online brokerage is, overall, seen as a ‘Buy’ with 23 of the 27 ratings assigned in the latest three months viewing it as such, and only one considering it a ‘Sell.’
It could, simultaneously, drive the 12-month forecast higher, considering the average price target, per the data Finbold retrieved from TradingView on March 25, remains below the 52-week highs as it stands at $124.50.
Why Robinhood stock might continue crashing in 2026
Elsewhere, retaining a cautious posture toward Robinhood would be a savvy move. HOOD stock’s impressive 2025 rally largely accompanied a similar performance among the world’s leading assets.
Notably, both the world’s premier cryptocurrency, Bitcoin (BTC), and the world’s largest company by market capitalization, Nvidia (NASDAQ: NVDA), claimed their outstanding all-time highs in October of the previous year.
Furthermore, though the $1.1 billion Robinhood spent on share buybacks since 2024 likely had some impact on the equity’s price, HOOD shares’ decline since October highlights the limitations of such a policy.
Thus, while traders who choose to buy the online brokerage’s shares will likely see benefits from the board’s approval, the tailwinds are unlikely to remain decisive in the mid and long term.
Featured image via Shutterstock
