Bank of America (BAC) has upgraded the stock of Robinhood Markets (HOOD) as the online brokerage continues to attract younger investors and diversify its business.
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Bank of America raised its price target on HOOD stock to $65 from $60 and reiterated a Buy rating on the shares. According to Bank of America, Robinhood continues to capture younger investors like no other brokerage in the marketplace today.
At the same time, Robinhood continues to expand into new areas such as wealth management to capture and serve clients as they age. The combination makes Robinhood a strong stock to own, especially as the market rebounds from the lows experienced in April pf this year amid tariff and trade war uncertainty, says Bank of America.
Acquisitions
News of the Bank of America upgrade comes on the same day that Robinhood Markets announced an expansion in Canada via the acquisition of cryptocurrency exchange WonderFi (WNDR). Robinhood is paying C$250 million to purchase WonderFi. The deal is expected to close by year’s end.
In addition to expanding in Canada, Robinhood Markets is also growing in Europe and offering new products that now include a cash back credit card. The company has delivered strong financial results in recent quarters, sending its share price up 70% this year.
Is HOOD Stock a Buy?
The stock of Robinhood Markets has a consensus Moderate Buy rating among 20 Wall Street analysts. That rating is based on 14 Buy and six Hold recommendations issued in the last three months. The average HOOD price target of $60.94 implies 3.79% downside from current levels.
