CEO Vlad Tenev of Robinhood (HOOD) reveals on Yahoo Finance Live his strategy to drive up the stock price of the online trading platform.
Tenev hopes that the efforts made will eventually raise the value of Robinhood’s stock over time, despite it being down by 1% in the past year in comparison to the S&P 500’s 14% gain. Charles Schwab (SCHW) and Morgan Stanley (MS) have also experienced drops of 23% and 10%, respectively, during the same period, further illustrating the challenging market conditions.
At present, Robinhood’s stock is priced at $9.55 per share, still 75% below its 2021 IPO price.
The year has been marked by significant milestones for Robinhood, especially after the GameStop (GME) trading frenzy that occurred years ago. Just last week, the company announced its plans for a 2024 UK launch with an array of features, including the availability of 6,000 US stocks and 24-hour trading five days a week. This venture into the UK market is the third attempt for Robinhood.
The move to the UK is not without its challenges due to UK markets regulator FCA’s warnings about the risks of gamifying investing, a criticism frequently associated with Robinhood. However, Robinhood has secured a license from the FCA, easing some concerns and disappointments in the past.
In terms of its expanding US market, Robinhood rolled out 24-hour trading on select stocks and ETFs earlier this year. The platform plans to introduce futures trading in 2024, along with a credit card offering, anticipated to fuel its lucrative future revenue streams.
Despite the rollout of various products, Wall Street remains cautiously optimistic about Robinhood’s stock.
JP Morgan analyst Ken Worthington has expressed skepticism about the sustainability of the company’s growth and its ability to generate competitive margins over time. However, there’s a silver lining in the form of expected profitability in 2024.
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