Bernstein Maintains $130 Robinhood Target Despite Q1 Miss

Bernstein analysts maintained their outperform rating and $130 price target on Robinhood on Wednesday, arguing the stock had already bottomed in the first quarter even as shares fell over 6% in after-hours trading following the company's quarterly results that fell short of Wall Street estimates. The stock closed at $82.07 on Tuesday. According to Bernstein's note, the weak Q1 numbers were already factored into the share price, and the $130 target implies 58% upside from the April 28 close.

Q1 Earnings Miss

Robinhood reported Q1 revenue of $1.067 billion, a 7% miss versus estimates, alongside adjusted EPS of $0.39 and adjusted EBITDA of $534 million, which Bernstein said missed expectations by 8% and 9%, respectively. Crypto revenue fell to $134 million, accounting for just 13% of total revenue versus 17% in Q4 2025, according to the analysts' note.

Platform Metrics and April Recovery

Bernstein highlighted that several platform metrics expanded despite the retail trading slowdown. Robinhood's margin book reached a record $17.0 billion, a 93% increase from the prior year. April activity showed equity and options volumes tracking toward the strongest month of the year, while the crypto segment stabilized in April, according to the note.

Robinhood Gold subscribers grew 36% year-over-year to 4.34 million, representing a 16% adoption rate among the platform's 27.4 million funded accounts. Prediction markets were pacing toward approximately $3 billion in contracts, per the analysts.

Prediction Markets and Expansion Into Public Sector

Prediction markets emerged as a primary growth driver, with event contracts trading a record 8.8 billion units in Q1. This segment contributed $415 million in annualized revenue, representing 17% of total transaction-based revenue, according to Bernstein's note.

Bernstein analysts pointed to the upcoming mid-2026 launch of Rothera, a joint venture exchange with Susquehanna that is expected to move Robinhood away from third-party venues like Kalshi, allowing the company to control pricing and product selection for event contracts.

The analysts also highlighted Robinhood's appointment as the sole initial trustee for "Trump Accounts," a new initiative in collaboration with BNY. Approximately 5.5 million children have signed up for the program out of an eligible pool of 60 million. Robinhood expects to invest $100 million into the vertical, adjusting its 2026 operating expense guidance to a range of $2.7 billion to $2.825 billion, per the note.

Bernstein maintained that asymmetric upside is being driven by prediction markets and a stabilization in crypto trading activity.