Robinhood (HOOD) stock is in focus after the company reported earnings. Autonomous Research senior analyst Christian Bolu joins Market Domination to dive deeper into the results and discuss what’s next for Robinhood.
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00:00 Josh
want to bring in here, Christian Bolo, senior analyst at Autonomous Research. Uh Christian, good to see you. So, uh the report hits the wires, at least initially, Christian, investors, um selling this one off. We’re down about 4%, but I’m interested to get your your reaction to the results. What do you make of them?
00:23 Christian Bolo
Yeah, it just it just hit and uh, Josh, thanks for having me on. Um, look, I think it’s a pretty solid print here. Look, I think the context obviously is stocks rallied quite significantly year to date. Um, expectations are very, very high on this one. Uh, but if you look at all the sort of numbers that investors tend to really care about, obviously top and bottom line beat, and it seems like very strong acceleration of net deposits, which is sort of your core measure of organic growth in September, one of their strongest months for that. Um, so I think I think all in very good. But, you know, again, to my point here, um, high expectations, some news about the CFO retiring and we could talk about that if you want. Maybe how that’s playing into some, um, some, um, uh, quick, uh, quick, uh, you know, initial slowdown in the stock here.
01:21 Josh
Yeah, to your to your point, Christian, I mean this one was a rocket ship. It was up about 270% year to date heading into the print. You know, as they move beyond sort of the bread and butter trading, um, Christian, into other avenues, other other opportunities. The prediction markets, the global prediction markets has is one that’s gotten a lot of attention. I’m curious as an analyst covering the name, what kind of opportunity you think that could create for Robin Hood looking ahead?
01:58 Christian Bolo
I think it’s pretty significant on a number of fronts. Uh, one is diversification away from trading type activities in terms of um, the the volatility around trading. So prediction markets, a lot of that is sports-related, has a completely different activity cycle from trading. So ultimately makes the company much more diversified, which in theory should make it a more valuable earning stream over time. And from a revenue perspective, it could be very significant. Um, you know, just look at um Robin Hood versus traditional sports uh betting uh businesses. The business is quite small in prediction markets. So just on that alone, you should see a ton of growth. But ultimately prediction markets can be a lot bigger than that. Um, uh predictions on politics, predictions around company fundamentals, macroeconomic um, um outlook. All these things are very new markets, potentially huge markets, especially if institutional money comes into the space. So, I think this could be a very big business for Robin Hood over time.
