Robinhood Markets Inc (NASDAQ: HOOD) is in focus this morning following a report that it’s considering launching its crypto products in Singapore by the end of 2025.
The financial services company is already said to be in talks with the local regulators but is yet to announce a particular launch date.
Robinhood is considering expanding its footprint in the Asia-Pacific region at a time when it’s reportedly losing share to Coinbase.
HOOD share price, nonetheless, has gained nearly five-fold in the trailing 12 months.
Robinhood is losing share to Coinbase
Robinhood has lost share in crypto spot trading to Coinbase in recent months.
According to Oppenheimer, the rival’s share in that market improved from 64% to 67% between November and January.
Plus, competitive risks from other notable brokerages like Charles Schwab and Fidelity are being overlooked as well, as per Steven Chuback.
The Wolfe Research analyst downgraded HOOD to “peer perform”, warning the upside is already baked into the fintech’s share price in a research note this morning.
Chuback removed his price target on Robinhood stock as well on Tuesday.
HOOD faces increased competition ahead
Chuback agreed that Robinhood’s pricing remains competitive despite a more than 2x increase since June.
However, as the Trump administration delivers on its promise of improved regulatory clarity, “we could see that advantage get competed away, with potential risk that Fidelity/Schwab launch similar spot crypto trading platforms at more competitive price points,” he added in his report.
Additionally, the Wolfe Research analyst downgraded Robinhood stock today due to valuation concerns. The risk/reward in HOOD is much more balanced at about 30 times its EPS estimates, according to the investment firm.
Meanwhile, shares of the financial services firm do not currently pay a dividend to appear any more attractive to income investors either.
Is Robinhood stock price backed by fundamentals?
Wolfe’s note on Robinhood stock arrives only days after the Nasdaq-listed firm reported $916 million in profit for its fourth financial quarter – up sharply from just $30 million a year ago.
HOOD’s transaction-based revenue more than tripled to $672 million as crypto trading revenue surged an exceptional 700% on a year-over-year basis.
Much of the strength was related to Bitcoin’s aggressive run to over $100,000 on hopes the new US government will create a more favorable environment for the crypto market.
Robinhood chief executive Vlad Tenev told investors at the time:
We hit the gas on product development in 2024 with a new platform for active traders, Gold Card launch, an expanded UK and EU product suite, and much more.
Investors should also know that not everyone on Wall Street is dovish on Robinhood stock.
The consensus rating on HOOD still sits at “overweight” with a Street-high price target of $105 indicating potential for another 60% upside from current levels.
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