Key Highlights
- Morgan Stanley’s ETrade platform is reportedly in advanced discussions to spearhead the retail share allocation for SpaceX’s upcoming IPO, leaving Robinhood and SoFi on the sidelines
- Sources indicate SpaceX may exclude both Robinhood and SoFi entirely from participating in the offering, though negotiations remain fluid
- Bernstein SocGen reduced HOOD’s price target from $160 down to $130 but maintained its Outperform recommendation
- The investment firm anticipates 25% earnings per share expansion in 2026 and revenue growth at a 30% compound annual rate between 2025 and 2027
- Shares of HOOD are currently trading approximately 54% beneath their 52-week peak of $153.86
Robinhood is navigating choppy waters. Trading at $66.02, the stock has surrendered more than half its value from recent highs, and Monday delivered a one-two punch — troubling IPO developments and an analyst downgrade.
According to a Reuters report, Morgan Stanley’s ETrade division is positioned to manage the retail investor portion of SpaceX’s highly anticipated initial public offering. This development would give ETrade a significant competitive advantage over Robinhood and SoFi, both of which have been vying for involvement in what analysts expect to be a landmark public debut.
Insider sources suggest SpaceX executives are contemplating removing both platforms from participation completely. However, these same sources emphasized that arrangements remain preliminary and subject to change ahead of the anticipated late-2025 listing.
Being shut out would represent a meaningful setback. Robinhood and SoFi previously secured prominent positions in major offerings including Arm Holdings’ $55 billion market debut and Instacart’s $9.9 billion IPO during 2023. Losing access to SpaceX would carry different weight — affecting both retail investor access and Robinhood’s reputation as a destination for blockbuster public offerings.
Neither platform maintains connections to the underwriting syndicate handling the SpaceX transaction. Morgan Stanley, serving as a primary underwriter, is anticipated to channel substantial retail allocations through ETrade, the brokerage it purchased in 2020.
Bernstein SocGen Reduces Price Objective
Also Monday, Bernstein SocGen adjusted its HOOD price target downward from $160 to $130, attributing the change to valuation considerations. The firm preserved its Outperform rating, signaling continued confidence in the stock’s upside potential despite the reduced outlook.
The modified target incorporates a more conservative earnings multiple: 35 times projected 2027 EPS, versus the previous 40 times multiplier. This calculation assumes a 32% EPS compound annual growth rate spanning 2025 through 2027.
Despite the adjustment, the analyst’s fundamental assessment of Robinhood’s operational performance remains constructive. The firm forecasts 25% EPS expansion during 2026, even accounting for sluggish first-quarter performance across equity and cryptocurrency segments. Revenue growth is projected at a 30% CAGR extending to 2027.
Prediction markets represent an emerging growth avenue. Bernstein SocGen estimates these products will generate approximately 17% of trading-related revenue and 10% of overall revenue in 2026, bolstered by Robinhood’s partnership with Kalshi and its proprietary Rothera exchange infrastructure.
Additional Analyst Perspectives
Cryptocurrency activity is likewise expected to rebound. The firm models a 79% year-over-year surge in crypto transaction volumes during the second half of 2026, facilitated by the Bitstamp acquisition.
Non-trading revenue streams are projected to expand 27% annually. This encompasses margin lending operations backed by a $17.2 billion portfolio, Gold subscription services reaching 4.2 million members, and banking deposit balances exceeding $1 billion.
Wall Street analysts present divergent outlooks. Barclays maintains an Overweight stance 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 adopted a more conservative posture, lowering its target to $95 based on revised revenue projections.
Robinhood’s board recently authorized a $1.5 billion stock repurchase initiative, which generated favorable commentary from multiple sell-side firms.
The equity currently carries a price-to-earnings ratio of 32.25 with a market capitalization totaling $59.44 billion.
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