Hi HODLers, Hiveans and Lions,
After witnessing (while not being an active participant) and watching the GameStop Series/Movies; I must say that I dislike RobinHood as they are not our allies.
On the other side, I am an investor and my goal is to find undervalued stocks with compelling growth/value stories and $HOOD is one of these.
$HOOD Q1-2024 Results
- Revenue $618M vs FactSet $552.7M [11 est, $531-576M]
- Adjusted EBITDA $247M vs FactSet $177.0M [8 est, $138-196.5M]
RobinHood is a master at gamifying the investment process for the good and the bad. More Gen Z and Millenials are getting interesting to invest thanks to them but a lot of them are also completely gambling their assets on 0day Options and other very risky products.
They currently have an investigation by the SEC on this "over gamification"
Robinhood said that net interest revenue rose 22% in the March quarter from a year earlier, “driven by growth in interest-earning assets and higher short term interest rates.”
Robinhood’s $254 million in net interest revenue makes up more than 40% of the company’s total sale! This percentage is on par with older Brokerage firms such as Charles Schwab.
Assets under Custody increased 65% year over year to $129.6 billion thanks to higher equity and cryptocurrency valuations. It also highlights their latest push to attract Retirement Investment accounts. They are currently offering a 3% match if you transfer you IRAs to them (there are a bunch of requirements such as leaving the assets for a few years, etc...).
FInally, they just launched a RobinHood Gold card giving 3% cashback and a bunch of other perks for just 5$ a month!
Cryptocurrency boom helped them this quarter but this is not the main reason I am thinking they are a good investment.
In other words, they are innovating, have great product and a lot of tailwinds going their way. I caa see them attracting hundreds of bn more of assets and really leveraging their tech focus DNA especially when comparing what they offer vs legacy Old/Regional Banks!
Despite these stellar results, the stock was down 3% today and I am thinking to add some more (Not Financial Advice obviously).
Stay safe out there,