TLDR
- Robinhood Markets (HOOD) is being considered for S&P 500 inclusion alongside other candidates like AppLovin and Vertiv Holdings
- The stock hit a four-year high of $71.72 following completion of its $200 million Bitstamp cryptocurrency exchange acquisition
- Company reported 25.8 million users and $221 billion in assets under custody, representing 70% growth year-over-year
- HOOD shares have rallied 92% over six months and gained 19% in a recent five-day streak
- S&P 500 quarterly rebalance announcement expected after Friday’s close, with changes taking effect June 20
Robinhood Markets is making headlines as one of the top candidates for S&P 500 inclusion while celebrating the completion of a major acquisition that sent shares to multi-year highs.
The fintech platform closed at $71.72 on Tuesday after finalizing its $200 million purchase of cryptocurrency exchange Bitstamp. This marked a four-year high for HOOD stock.
Pre-market trading Wednesday saw shares climb modestly to nearly $72.00. The acquisition combines Robinhood’s existing equities and options trading with expanded crypto capabilities.
The timing couldn’t be better for the company. Robinhood finds itself among 27 eligible candidates for the next S&P 500 quarterly rebalance.
Bank of America says Robinhood $HOOD is a “prime candidate” for S&P 500 inclusion 👀
Just this afternoon, over $1.3M in call premium hit the tape for $80 calls expiring on 7/18. Big bets ahead of tomorrow’s announcement.
Will Robinhood make the cut? pic.twitter.com/Qwg09KiwTC
— CapitalFlow (@CapitalFlowApp) June 5, 2025
The index committee at S&P Dow Jones Indices requires new entrants to maintain at least $20.5 billion in market capitalization plus meet profitability criteria. Robinhood currently checks both boxes.
S&P 500 Stakes and Market Dynamics
The announcement is expected after Friday’s market close. Changes would take effect after trading ends on June 20.
Other fintech companies in consideration include Interactive Brokers Group and Block Inc. AppLovin leads all candidates by market cap at over $140 billion.
HOOD shares have gained 19% over five consecutive trading days. This rally suggests Wall Street optimism about potential index inclusion.
The broader six-month picture shows even stronger performance. Robinhood has delivered a 92% return to investors during this period.
S&P 500 inclusion typically brings automatic buying from index funds. This forced demand often drives share prices higher for new additions.
However, companies that miss the cut sometimes face selling pressure from disappointed investors who bought on speculation.
Fundamental Growth Drives Performance
The S&P 500 speculation represents just one catalyst for Robinhood’s recent strength. User growth and financial metrics show solid underlying business momentum.
The platform now serves 25.8 million users, up 1.9 million over the past 12 months. These customers have brought $221 billion in assets under custody to the platform.
This represents 70% growth compared to the first quarter of 2024. The company generates interest income on uninvested cash balances.
Total revenues reached $927 million quarterly, translating to $3.3 billion on an annual basis. Trading volumes hit $413 billion for equities and $500 million for options in Q1 2025.
Recent market volatility from trade tariff announcements has boosted trading activity across platforms. This should benefit Robinhood’s fee-based revenue model in upcoming quarters.
The software-based business model allows for high profit margins. This scalability helps the company compound earnings growth as user numbers expand.
Robinhood’s expansion beyond basic trading includes retirement account management and a rewards credit card. The platform also offers high-yield savings accounts to customers.
The Bitstamp acquisition represents the latest move to capture cryptocurrency trading growth. Digital asset trading has become a key revenue driver for retail brokerages.
Wednesday’s pre-market action showed continued investor interest despite shares already reaching multi-year peaks following the Bitstamp news completion.
Stay Ahead of the Market with Benzinga Pro!
Want to trade like a pro? Benzinga Pro gives you the edge you need in today's fast-paced markets. Get real-time news, exclusive insights, and powerful tools trusted by professional traders:
- Breaking market-moving stories before they hit mainstream media
- Live audio squawk for hands-free market updates
- Advanced stock scanner to spot promising trades
- Expert trade ideas and on-demand support
