Key Takeaways
- Morgan Stanley’s ETrade platform is reportedly leading negotiations to distribute SpaceX’s retail IPO shares, potentially sidelining Robinhood and SoFi
- Sources suggest SpaceX may completely exclude both Robinhood and SoFi from participation, although discussions remain fluid
- Bernstein SocGen reduced HOOD’s price target from $160 down to $130 while maintaining its Outperform recommendation
- Analysts still anticipate 25% earnings per share expansion in 2026 and project a 30% revenue compound annual growth rate spanning 2025 through 2027
- Shares of HOOD are currently trading approximately 54% beneath the 52-week peak of $153.86
Robinhood is navigating turbulent waters. Trading at $66.02, shares have plummeted more than half their value from the annual high, and Monday delivered a one-two punch — troubling IPO news paired with an analyst downgrade.
According to Reuters, Morgan Stanley’s ETrade division is negotiating to handle retail distribution for SpaceX’s upcoming public offering. This development positions ETrade ahead of competitors Robinhood and SoFi, both of which have been vying for involvement in what industry watchers predict could become the largest IPO on record.
Reports indicate SpaceX is contemplating whether to exclude both trading platforms completely from any participation. However, individuals familiar with the matter emphasized that arrangements remain preliminary and subject to change ahead of the anticipated listing later this year.
The prospective omission carries significant implications. Robinhood and SoFi previously participated in marquee offerings including Arm Holdings’ $55 billion market debut and Instacart’s $9.9 billion IPO during 2023. Being shut out of SpaceX would represent more than just a missed opportunity — it threatens Robinhood’s positioning as the premier destination for retail investors seeking access to major public listings.
Neither platform maintains relationships with the investment banks managing the SpaceX offering. Morgan Stanley, serving as a principal underwriter, is anticipated to channel substantial retail share allocations through ETrade, the brokerage it purchased in 2020.
Bernstein SocGen Reduces Price Objective
Also Monday, Bernstein SocGen decreased its HOOD valuation from $160 to $130, attributing the adjustment to current market multiples. The firm maintained its Outperform designation, signaling continued confidence in the stock’s upside potential despite the reduced target.
The modified forecast applies a lower earnings multiple: 35 times projected 2027 earnings per share, compared with the previous 40 times multiple. This calculation incorporates an expected 32% EPS compound annual growth rate spanning 2025 through 2027.
Notwithstanding the target reduction, analysts remain constructive on Robinhood’s fundamental business trajectory. The firm forecasts 25% earnings growth during 2026, even accounting for anticipated weakness across both equity and cryptocurrency trading in the opening quarter. Revenue expansion is projected to maintain a 30% CAGR through 2027.
Prediction markets represent an emerging growth catalyst. Bernstein SocGen estimates these offerings will generate approximately 17% of trading-related revenue and 10% of overall revenue during 2026, bolstered by Robinhood’s distribution partnership with Kalshi and its proprietary Rothera exchange infrastructure.
Additional Analyst Perspectives
Cryptocurrency activity is likewise expected to rebound. The firm’s model anticipates a 79% year-over-year surge in crypto trading volumes throughout the latter half of 2026, aided by the completed Bitstamp acquisition.
Non-trading revenue streams are forecast to advance 27% annually. This encompasses margin lending supported by a $17.2 billion portfolio, Gold membership subscriptions serving 4.2 million users, and banking deposit balances now surpassing $1 billion.
Wall Street sentiment remains divided. Barclays maintains an Overweight rating with a $124 price objective. Truist carries a Buy recommendation at $120. Jefferies initiated coverage recently with a Buy rating and $88 target. Cantor Fitzgerald takes a more conservative stance, trimming its target to $95 based on adjusted revenue projections.
Robinhood’s board of directors recently authorized a $1.5 billion stock repurchase program, generating favorable commentary from multiple analyst firms.
Shares currently command a price-to-earnings ratio of 32.25 with a market capitalization reaching $59.44 billion.
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