Shares of Robinhood Markets, Inc. (NASDAQ:HOOD) advanced 1.2% to $101.19 in midday trading on Monday, buoyed by an upbeat analyst note from Bernstein. The firm maintained its Outperform rating and lifted its price target to $160 from $130, representing potential upside of approximately 58% from current levels.
Bernstein's optimism stems from robust growth in prediction markets. The broker projects that prediction-market revenue will expand at a compound annual rate of 64% through 2028, reaching $1.7 billion and potentially overtaking crypto revenue as soon as this quarter. However, the firm tempered its crypto outlook, slashing its 2026 crypto revenue estimate by 49%. Despite this, Bernstein still expects total revenue to reach $5.3 billion.
Robinhood's internal data confirms the trend. Early figures for June show 5.2 billion event contracts traded through June 25, averaging 208 million per day—a 65% increase from May. Daily event contract activity averaged 98 million in Q1 2026 and 126 million in May, accelerating sharply in June. In contrast, daily crypto notional trading on Robinhood's app averaged approximately $240 million in June, down 10% from the Q1 average of $267 million.
The shift in business mix is notable. While crypto volumes have cooled, event contracts have more than doubled, becoming the primary driver of transaction revenue. Robinhood's first-quarter results showed a 15% revenue increase to $1.07 billion, with adjusted EBITDA of $534 million. Other transaction revenue surged 320% to $147 million, largely due to event contracts. CFO Shiv Verma highlighted "record volumes for prediction markets, futures, and index options."
Robinhood's exchange, Rothera, launched in late May and has already processed over 3.5 billion contracts. However, about 93% of its trade activity came from World Cup markets, underscoring a concentration risk. This heavy reliance on a single event complicates annualized projections for June's results, as sustained growth depends on diversifying into other prediction markets.
On the valuation front, Bernstein notes that at Monday's share price, Robinhood trades at roughly 22 times its estimated 2028 earnings of $4.56 per share. The $160 price target assumes a 35 times multiple, implying significant upside. The firm believes a rerating is needed to reflect the company's evolving revenue mix and growth potential.
Meanwhile, shares of Space Exploration Technologies Corp. (NASDAQ:SPCX) declined 0.8% to $123.00, trading approximately 9% below their $135 IPO price from June. SpaceX has set July 23 for Starship's 13th test flight after a July 16 launch attempt was aborted just before liftoff. The mission will deploy 20 demonstration Starlink satellites on a suborbital trajectory.
SpaceX plans to begin launching operational Starlink satellites into orbit aboard Starship before year-end, according to its prospectus. The company recently requested U.S. authorization for 100,000 Gen3 satellites, each weighing between 2,000 and 2,500 kilograms, which would likely require Starship for deployment due to their size. However, the majority of Rothera's volume remains tied to World Cup markets, and SpaceX faces ongoing risks from launch delays.
SpaceX's next key milestone is Starship's test flight on Thursday. Robinhood is scheduled to report second-quarter earnings on July 29 at 5 p.m. EDT. Investors will be watching closely to see if prediction-market momentum can offset crypto headwinds and sustain the company's growth trajectory.
