Robinhood Markets (HOOD) Surges 12.8%: Is This an Indication of Further Gains?

Robinhood Markets, Inc. (HOOD) shares ended the last trading session 12.8% higher at $93.63. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 25.5% gain over the past four weeks.

Robinhood stock skyrocketed to a new all-time high of $94.24 yesterday on the news of its further expansion into the cryptocurrency space. The company announced the introduction of U.S. stock and exchange-traded fund (ETF) tokens for European Union (EU) investors with no commissions and 24/5 accessibility. Also, the company launched crypto staking for eligible U.S. investors starting with Ethereum and Solana. These developments cheered the investors, driving the HOOD stock higher.

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This company is expected to post quarterly earnings of $0.30 per share in its upcoming report, which represents a year-over-year change of +42.9%. Revenues are expected to be $887.04 million, up 30.1% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Robinhood Markets, the consensus EPS estimate for the quarter has been revised 0.6% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on HOOD going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Robinhood Markets is part of the Zacks Financial - Investment Bank industry. Piper Sandler Companies (PIPR), another stock in the same industry, closed the last trading session 1.4% lower at $277.94. PIPR has returned 12.1% in the past month.

Piper Sandler Companies' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.99. Compared to the company's year-ago EPS, this represents a change of -21%. Piper Sandler Companies currently boasts a Zacks Rank of #4 (Sell).

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This article originally published on Zacks Investment Research (zacks.com).

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