Should you buy Robinhood Markets stock when it’s below $125?

Robinhood Markets (NASDAQ:HOOD) has arguably been one of the most disruptive names in the stock market in recent years. Robinhood’s innovative platform, which allows investors to buy and sell stocks and trade options, has popularized stock trading. fractions of shares and made commission-free trading widespread.

Robinhood’s platform gained popularity during the height of the COVID-19 pandemic, and it has become a popular stock to trade since its IPO the following year. This year has been the best ever in the sotck exchangeas shares hit an all-time high of $153.86.

Robinhood continues to evolve, enabling cryptocurrency trading, integrating artificial intelligence, and expanding into prediction markets. However, the stock has weakened in recent weeks due to increasing competition and widespread weakness in cryptocurrency prices.

Now trading 24% off its all-time highs, Robinhood shares are on sale and expected to see an inevitable rebound. Should you jump on Robinhood stock while it’s still below $125?

Robinhood Markets is a popular trading platform for stocks, exchange-traded funds, cryptocurrencies, and options. The company has played a major role in making stock trading accessible – and enjoyable – for retail investors. It operates a mobile application that simplifies trading and includes a dynamic community platform that allows users to share information, talk about their trades and see how other users are performing.

Since Robinhood offers commission-free trading, it makes its money through payment for order flow (PFOF), in which market makers pay Robinhood for the right to execute users’ trades. Robinhood also makes money from interest on customers’ cash and margin loans, as well as its premium Robinhood Gold service.

Third-quarter revenue was $1.28 billion, up 11% from last year. Robinhood saw a 129% increase in transaction-based revenue and a 100% increase in revenue from Robinhood Gold subscribers.

The company has 26.9 million funded customers, with total platform assets of $325 billion. Although these numbers are up significantly from last year, they also show a sequential slowdown.

Data Source: Robinhood Markets.

Interestingly, cryptocurrency trading has declined significantly this year, reflecting the collapse of the cryptocurrency market. When cryptocurrency prices rebound, I expect these numbers to recover as well.

I don’t like companies that don’t move. One of the things I like most about Robinhood is that it’s continually adding features and evolving – and that’s one of the main reasons the stock price is up 215% in 2025.

Robinhood launched its asset tokenization program in June for the European Union, which makes stocks available for trading in European countries. Tokenization works on the blockchain, converting ownership of shares into tradable digital tokens. Robinhood launched the effort with 200 stocks available, then increased it to more than 400 stocks by the end of the third quarter.

CEO Vladimir Tenev told analysts that the company plans to make tokenized stocks available on the secondary market on Bitstamp, “and then being on DeFi, the possibilities really start to multiply. You start to think about self-custody, collateralized lending and borrowing, which we think could also be very, very disruptive.”

Robinhood is also going full throttle into prediction markets, which allow users to bet on the outcomes of future events, such as politics, sporting events or things like Federal Reserve actions. There are currently more than 2,100 events available on the Robinhood app for users to place prediction bets, ranging from college football champion to number of confirmed measles cases.

“The prediction markets are really on fire,” Tenev said. “It’s hard to believe we started this just a year ago with the presidential election markets. Since then, we’ve doubled volume every quarter to 2.3 billion contracts in the third quarter. And October alone reached 2.5 billion contracts.”

I can understand why Robinhood pulled back in recent weeks. Any time a stock gains more than 200% in a year, there is concern that it is overvalued. The fall in cryptocurrency prices is also a problem. It’s no coincidence that Robinhood shares fell with Bitcoin And Ethereum over the last three months.

But Robinhood is poised for incredible gains. Analysts expect revenue to rise by nearly $1 billion, to $5.43 billion.

Analysts are growing more optimistic about their price targets. Of the five analysts who have issued updated price targets in the past two months, they are all above $145, representing at least 24% gains over the coming months.

Data source: Yahoo! Finance.

It’s never a good idea to time the market, so if you’re waiting for a bottom for Robinhood Markets stock, don’t do it. For long-term investors, Robinhood appears to be a strong buy right now, and investors would do well to jump in before the stock breaks above the $125 mark again.

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Patrick Sanders has positions in Ethereum. The Motley Fool posts and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy.

Should you buy Robinhood Markets stock when it’s below $125? was originally published by The Motley Fool