Key Takeaways
- Morgan Stanley’s ETrade platform is negotiating to exclusively manage SpaceX’s retail IPO distribution, potentially sidelining Robinhood and SoFi
- Sources indicate SpaceX may completely exclude both Robinhood and SoFi from participating in the offering, though negotiations continue
- Bernstein SocGen reduced HOOD’s price target from $160 down to $130, maintaining its Outperform rating
- Analysts still forecast 25% EPS expansion for 2026 and anticipate a 30% revenue compound annual growth rate spanning 2025–2027
- HOOD shares currently trade approximately 54% beneath their 52-week peak of $153.86
Robinhood is navigating choppy waters. Trading at $66.02, the stock has plummeted more than half from its 52-week peak, and Monday delivered a double blow — troubling IPO news alongside a downward price revision.
A Reuters report revealed that Morgan Stanley’s ETrade division is negotiating to handle the retail distribution for SpaceX’s anticipated public offering. This development would position ETrade ahead of Robinhood and SoFi, both platforms that have aggressively pursued involvement in what many predict will be history’s largest IPO.
According to reports, SpaceX is considering completely excluding both competing platforms from participation. However, insiders emphasized that arrangements remain fluid and subject to change before the expected launch later this year.
The possible exclusion carries significant implications. Robinhood and SoFi previously secured prominent positions in major public offerings, including Arm Holdings’ $55 billion market debut and Instacart’s $9.9 billion listing throughout 2023. Being shut out of SpaceX would represent more than a missed opportunity — it could damage Robinhood’s reputation as the preferred destination for retail investors seeking access to blockbuster IPOs.
Neither platform maintains relationships with the investment banks managing the SpaceX underwriting. Morgan Stanley, serving as a primary underwriter, plans to funnel substantial retail allocations through ETrade, the platform it purchased in 2020.
Bernstein SocGen Reduces Price Projection
Also Monday, Bernstein SocGen decreased its HOOD price objective from $160 to $130, attributing the adjustment to valuation considerations. The firm maintained its Outperform designation, signaling continued confidence in the stock’s upside potential, albeit with tempered expectations.
The updated forecast applies a reduced earnings multiple: 35 times projected 2027 EPS, decreased from the previous 40 times multiple. This calculation assumes a 32% EPS compound annual growth rate spanning 2025 through 2027.
Despite the reduction, the analyst’s fundamental assessment of Robinhood’s operational performance remains optimistic. The firm anticipates 25% EPS expansion throughout 2026, even accounting for anticipated weakness in both equity and cryptocurrency trading during the first quarter. Revenue projections point toward a robust 30% CAGR extending through 2027.
Prediction markets represent an emerging catalyst. Bernstein SocGen estimates these markets will generate approximately 17% of trading revenue and 10% of overall revenue during 2026, bolstered by Robinhood’s distribution partnership with Kalshi and its proprietary Rothera exchange infrastructure.
Additional Analyst Perspectives
Cryptocurrency trading is projected to rebound strongly. The firm’s models anticipate a 79% year-over-year surge in crypto trading activity during 2026’s second half, amplified by the strategic Bitstamp acquisition.
Non-trading revenue streams are forecast to expand 27% year-over-year. This encompasses margin lending operations supporting a $17.2 billion loan portfolio, Gold subscription services serving 4.2 million members, and banking deposit balances now exceeding $1 billion.
Analyst sentiment remains divided. Barclays maintains an Overweight recommendation with a $124 price objective. Truist carries a Buy rating at $120. Jefferies initiated coverage recently with a Buy recommendation and an $88 target. Cantor Fitzgerald adopted a more conservative stance, trimming its target to $95 following revised revenue projections.
Robinhood’s leadership recently authorized a $1.5 billion stock repurchase initiative, which garnered favorable commentary from multiple research firms.
The stock presently commands a price-to-earnings ratio of 32.25 with a market capitalization reaching $59.44 billion.
