Financial services company Robinhood Markets, Inc. (NASDAQ:HOOD) has acquired Cove Markets, a crypto trading platform, for an undisclosed amount, a report published by CoinDesk.com said, citing a blog post by Robinhood.
Headquartered in Chicago, Cove Markets provides tools to help users manage their crypto accounts and build their portfolios.
California-based Robinhood operates a mobile app to offer users commission-free trades of stocks, exchange-traded funds and cryptocurrencies.
Shares of HOOD closed nearly 3% lower on Tuesday. The stock, however, rose 0.2% in the extended trading session to end the day at $19.17.
The acquisition is aimed at allowing Robinhood’s customers manage their crypto accounts easily.
Following the completion of the acquisition, Scott Knudsen and Victoria Glava, the co-founders of Cove, along with its team, will join Robinhood’s crypto team.
The crypto team will concentrate on “obtaining quality executions for customers in the crypto market,” the post said.
The COO of Robinhood Crypto, Christine Brown, said, “[Cove’s] wealth of experience in trading execution and crypto market infrastructure will help us build more powerful trading capabilities, bringing the benefits of better competition in the crypto markets to our customers.”
Wall Street’s Take
Recently, Goldman Sachs (GS) analyst Will Nance maintained a Hold rating on the stock with a price target of $31 (62.1% upside potential).
The analyst expects the company to report a loss of $2.06 per share in the fourth quarter of 2021.
Overall, the stock has a Moderate Buy consensus rating based on 6 Buys, 5 Holds and 1 Sell. The average Robinhood Markets price target of $44.50 implies 132.6% upside potential. Shares have gained 81.2% over the past year.
TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into Robinhood’s performance.
According to the tool, compared to the previous year, the company’s website traffic registered a 5.8% rise in global visits in November. Moreover, the website traffic has increased 61.1% year-to-date against the same period last year.