Robinhood Markets, Inc. (NASDAQ: HOOD), based in Menlo Park, California, released its November 2024 data on December 11, highlighting notable growth across multiple metrics. The company reported increased funded customers, assets under custody, and trading volumes, underscoring a period of substantial expansion.
With a focus on cryptocurrencies and increased customer engagement, Robinhood positions itself as a key player in the financial technology sector.
Robinhood Added ~420k Funded Customers in Nov, Total of Up to 24.8 Million
Robinhood added 420,000 funded customers in November, bringing the total to 24.8 million. This growth reflects the company’s ongoing efforts to attract and retain users, resulting in a year-over-year increase of 1.5 million customers. The surge in new accounts is complemented by a rise in net deposits, which reached $5.6 billion for the month, representing a 42% annualized growth rate from October.
These figures suggest a robust customer acquisition and engagement trend, contributing to the company’s expanding user base.
A standout aspect of Robinhood’s November report is the remarkable increase in cryptocurrency trading volumes. The company reported $35.2 billion in crypto notional trading volumes, marking a staggering 529% rise from the previous month and a 780% increase year-over-year.
This dramatic growth highlights the increasing importance of cryptocurrencies in Robinhood’s business model, as daily average revenue trades for crypto also surged by 400% from October and the previous year. The addition of 420,000 users coincidentally aligning with a meme number in the crypto community underscores digital currencies’ cultural and financial significance within the platform.
Robinhood Stock Continues to Gain Amid Significant Growth
Robinhood’s stock has experienced notable movement, reflecting the company’s overall growth and market sentiment. As of December 16, 2024, the stock opened at $41.10 and reached a current price of $41.18 at the time of writing, with a day high of $41.75.
The stock has grown significantly over the past year, rising from a 52-week low of $10.38 to a high of $42.76. Analysts maintain a positive outlook, with a “buy” recommendation and a target median price of $49.00, suggesting potential upside from the current level. However, the stock’s high beta indicates greater volatility, and the company’s debt-to-equity ratio poses a potential risk factor.
Robinhood’s financial metrics reveal a complex picture of growth and challenges. The company boasts a market capitalization of over $36 billion, with a trailing P/E ratio of 71.01 and a forward P/E ratio of 31.70. Despite these promising figures, the high debt-to-equity ratio of 102.75 may raise concerns among investors.
Nevertheless, the company’s total revenue of $2.4 billion and a forward EPS of $0.73 reflect a strong financial foundation. With a target high price of $60.00, Robinhood’s stock remains an attractive option for investors seeking growth in the fintech sector.
Disclaimer: The author does not hold or have a position in any securities discussed in the article.
About the author
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird’s US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
