QS Research · Michael Burry's Scion Capital analyst template · 2006
Robinhood Markets, Inc. (HOOD)
As of 2026-11-08 · 12/15 boxes filled from SEC filings and market data
Conclusion: WATCH
Conviction low · base case none · downside -25% · upside +30%
The market is paying a top-of-peer multiple for up-cycle earnings: N19 put TTM P/E at 37.2x and N18 put TTM P/S at 14.50x, the highest in the comp table, while the FY2020-FY2025 pre-tax sum is -$2.07B and TTM net income to common (N12) is $1.98B, above the entire six-year cumulative to common. Because cycle-average earnings are negative, I keep the base on TTM, not a normalized average, and quote TTM net income to common $1.98B beside TTM revenue $5.08B. At N19 37.2x on N12 $1.98B, the base is about $73.7B, matching N6 $73.71B and N1 $80.91, or 0%. Downside applies the FY2021-FY2022 -24.9% revenue decline at the TTM net margin: $5.08B x 0.751 = $3.82B, x 39.0% = $1.49B, x 37.2x = $55.3B, / 911M = about $60.7, or -24.9%; upside applies S84's +29.8% next-year revenue forecast at the same margin: $5.08B x 1.298 = $6.59B, x 39.0% = $2.57B, x 37.2x = $95.6B, / 911M = about $104.9, or +29.7%. The rule does not give a short because the base is not -30% or lower and the upside is above +25%, so this is a watch, not a pass: the valuation has no margin of safety but the cited arithmetic does not yet meet the short test at today's multiple.
Key numbers
- Share price: $80.91
- Market cap: $73.71B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $5.08B
- P/E (TTM): 37.2x
The 15 boxes
- ✓ 1. Long-form business notes
Robinhood is a vertically integrated retail investing and crypto platform whose FY2025 10-K monetization includes commissions and fees on event contracts, futures and EU crypto, Gold subscriptions, margin and securities lending, cash sweep, and wealth-management fees; the sources do not give segment financials. XBRL shows revenue of $1.81B in FY2021, $1.36B in FY2022 and $4.47B in FY2025, with net income to common of -$3.69B, -$1.03B and $1.88B, respectively. From FY2021 to FY2025 the business description expands from mobile stock/ETF/options/crypto plus Gold and Cash Management to futures, prediction markets, short selling, U.K./EU operations, Bitstamp/TradePMR, banking, Gold Card and advisory. No Q3 2026 or TTM figures are in the provided sources.
- ✓ 2. Competitive advantage
Robinhood has grown revenue from $958.0M in FY2020 to $4.47B in FY2025 and only reached positive full-year GAAP net income in 2024, so the record shows scale and brand reach but not yet a proven through-cycle margin. The 10-K claims a vertically integrated, licensed platform, a category-defining brand and a cost advantage, but the same filing lists large legacy institutions, large technology companies and smaller fintech entrants as competitors, many with greater resources, and warns results track trading activity quarter to quarter. Its revenue model also leans on transaction-based payments from a concentrated set of liquidity providers, and single products (event contracts, staking, stock tokens, the Rothera JV) carry product-level regulatory risk. No TTM, ROE, P/B or FY2025 total equity figure appears in the supplied sources.
- ✓ 3. 10-Q takeaways
Q3 2026 10-Q shows total net revenues of $1,424m, up 12% from Q3 2025, with transaction revenue up 19% to $867m as event contracts, options and equities offset a 55% crypto decline. Net income attributable to Robinhood fell 16% to $468m and included $67m of unrealized RVI mark-to-market losses; total operating expenses rose 16% to $739m. Cash was $5.83b at Sep 30 2026 and Q3 buybacks were $25m; the earnings release gives a numeric 2026 Adjusted Operating Expenses and SBC outlook of $2.675-$2.75b. Risk factors in the 10-Q include event-contract regulatory actions and Rothera joint-venture control.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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