Robinhood's Prediction Markets Now Outearn Stock and Crypto Combined — Analysts Are Chasing $150 September 8, 2026

 [NEXT WEEK Featured Pretiming Report]

📌 Next Week's Featured Ticker: HOOD
Each week, SPR features one ticker for in-depth coverage. The Weekly Pretiming Report is updated both this week and next week, while the Daily Pretiming Report is updated throughout next week's trading sessions. All reports are published at pretiming.report.

Robinhood closed Monday at $122.00, up sharply from a 52-week low near $63.52 set back in March. What's driving Wall Street's continued enthusiasm isn't the crypto trading desk that made the company famous during the meme-stock era — it's a product fewer than 2 million of Robinhood's 28 million customers have even touched. Before SPR's technical coverage on HOOD updates next week, here's the fundamental picture: what's actually driving the business, where analysts have set their targets, and the regulatory question mark now hanging over Robinhood's newest growth engine.

The News Behind the Move

Think about a brokerage built on stock and options trading suddenly discovering its fastest-growing business is neither of those things. That's Robinhood's second quarter of 2026, reported July 29: total net revenue rose 32% year-over-year to $1.31 billion, and net income climbed 48% to $573 million. But the number that caught Wall Street's attention wasn't the top line — it was the mix underneath it. Prediction markets, where customers trade contracts tied to real-world outcomes, generated $156 million in quarterly revenue, more than the $129 million from equities trading and the $100 million from crypto combined. Fewer than 2 million customers have used the product at all.

The rest of the quarter backed up the story. Average revenue per user climbed 24% year-over-year to $187, even as the funded account base grew a more modest 7% to 28.4 million. Gold subscribers hit a record 4.8 million, net deposits reached $21.7 billion for the quarter, and the company now counts 13 distinct business lines each generating more than $100 million in annualized revenue — retirement accounts, banking, advisory, and its Rothera derivatives exchange among them. Management has flagged the September 29–30 HOOD Summit as the next milestone where more of that strategy gets laid out publicly, and the company's next earnings report is expected around November 3.

What Wall Street Analysts Are Saying

The upgrades have been landing in twos and threes over the past few weeks, and almost all of them point the same direction.

• Bernstein — reiterated its $160 target, the highest in current coverage
• Morgan Stanley (Michael Cyprys) — upgraded to Overweight from Equal-weight on September 1, raising the target to $150 from $124, and lifting 2026–2028 earnings estimates by 12% to 15% along the way
• Goldman Sachs — raised its target to $123 from $118, maintaining an Overweight/Buy stance
• Street average — FactSet data shows a consensus target near $125–126, with TipRanks tallying 16 Buy ratings against 2 Holds among 18 analysts, and LSEG data showing 22 of 28 covering analysts at buy or strong buy

That leaves a forecast range running from roughly $100 on the low end to $160 on the high end — a spread that, notably, sits almost entirely above where the stock trades today, which is a different picture than the wider, more evenly split ranges seen on some of the earlier names in this series.

Is HOOD Overvalued or Undervalued?

This is where the prediction-markets story runs into a real tension. Robinhood trades at a trailing P/E in the 45–61 range depending on the data source and timing, a forward P/E above 50, and a price-to-sales ratio near 19 times trailing revenue — multiples that price in a great deal of continued growth, not a mature, slow-growing brokerage. Return on equity of roughly 23.6% and net margins above 40% give the bull case something real to point to, but this is unambiguously a stock priced for the future it's promising rather than the business it already has.

Morgan Stanley's own target math is a useful window into how the bulls are thinking: the firm's $150 figure applies a 25-times multiple to probability-weighted 2031 earnings — a genuinely long time horizon, and one that assumes prediction markets, Rothera, and the rest of the 13 business lines keep compounding roughly as they have. That's a defensible bet given the trendline, but it's also exactly the kind of assumption that leaves little room for a stumble along the way.

The Risk Variables Investors Should Watch

Three threads worth following past next week:

The regulatory ground under prediction markets just shifted. The Ninth Circuit ruled that sports event contracts offered by Robinhood, Kalshi, and Crypto.com are not swaps under the Commodity Exchange Act — on the surface a legal win, but one that opens the door for individual states like Nevada to apply their own gaming laws to those same contracts. A product generating more revenue than Robinhood's entire crypto and equities businesses combined is now navigating a patchwork of potential state-level rules rather than a single federal framework.

Tokenization is now a public fight, not just a regulatory filing. Robinhood CEO Vlad Tenev has been publicly defending the company's tokenized-stock ambitions after AMC's CEO Adam Aron challenged their legality, and the SEC's tailored rules for crypto contracts and tokenized securities are still pending. How that framework lands will matter for whether Robinhood can bring products it already offers overseas to U.S. customers.

Crypto volumes are actually falling even as the stock rallies. Morgan Stanley's own upgrade explicitly cut its crypto revenue forecasts for Robinhood while raising overall earnings estimates — a reminder that the bull case here has quietly rotated away from the business Robinhood is best known for and toward newer, less-tested revenue lines.

If the Story Shifts From Here

Suppose the HOOD Summit later this month lays out a credible roadmap for scaling prediction markets internationally, or Nevada and other states opt not to aggressively apply gaming law to event contracts — that's the scenario where Bernstein's $160 and Morgan Stanley's $150 targets start to look achievable rather than aspirational. Now suppose instead state regulators move quickly to restrict sports-related contracts, or the tokenization dispute drags into prolonged SEC uncertainty — that's the scenario where a stock already trading near 50 times forward earnings has the most room to give back. Which of those paths plays out first is exactly what next week's technical coverage is built to capture.

Conclusion

One-line takeaway: Robinhood's growth engine has genuinely shifted toward prediction markets and platform monetization rather than crypto, and Wall Street has raised targets to match — but the same regulatory ambiguity that let this business grow this fast is now the biggest variable in whether it keeps compounding.

Next week, SPR's Pretiming Report will bring the technical read on HOOD — zone positioning, directional bias, and the trading framework built around it. Watch for it at pretiming.report.