Wolfe Cuts Robinhood (HOOD) Price Target by 30% as Crypto Slump Drags Stock Down

As of April 1, Wolfe Research firm lowered its price target for Robinhood HOOD +1.11% ▲ from $115 to $81, reflecting a steep drop of roughly 30%. The firm’s revision comes after the HOOD stock fell as its crypto transaction revenue slumped. This decline has also been fueled by the broader weakness seen in the crypto market.

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HOOD Price Target Slashed as Crypto Trading Slump Adds Pressure

Wolfe’s HOOD price cut reflects a more cautious outlook as crypto retail trading slows on Robinhood’s platform. During the 2021 boom, cryptocurrency trading made up a large share of Robinhood Markets’ revenue, but that growth normalized after prices and volumes fell in late 2021 and early 2022. The recent crypto slump has once again reduced the company’s trading activity, putting pressure on its annual revenue.

In its latest earnings results, Robinhood reported $1.28 billion in Q4 revenue, missing Wall Street’s $1.35 billion estimate, while crypto transaction revenue fell 38% year-over-year. The weakness continued into March, with crypto trading activity dropping 36% from February levels, ahead of its first-quarter earnings due on April 29.

Notably, Robinhood’s revenue performance is primarily tied to its crypto activity. When prices fall, trading slows, and investors shift away from high-margin altcoins to safer assets. As a result, the market continues to treat the HOOD stock as a crypto proxy, which influences its price action. Notably, this dynamic has been a major driver of the stock’s 37% YTD decline and a more than 54% drop below its 52-week high.

Wolfe Stays Bullish on HOOD Stock Despite Price Cut

Despite slashing its HOOD target, Wolfe maintained an “Outperform” rating for the stock, meaning analysts remain confident in a bullish recovery. The new $81 price target represents 15% upside from current levels around $70, highlighting analysts’ optimism for the stock.

This bullish outlook is likely fueled by the strength in Robinhood’s earnings forecast, product mix, and pricing structure. Wolfe’s previous $125 price target set in early February implied a strong upside, and the firm’s successive reductions to $115 and then $81 highlights its growing caution as risks around crypto, regulation, and competition become clearer. Compared with other analysts at Bernstein AB +1.71% ▲ and Barclays (BARC), who currently project 84% and 75% surges, respectively, Wolfe’s $81 target is much more conservative.

Is Robinhood Stock a Good Buy?

Based on TipRanks data, the Robinhood (HOOD) stock currently has a “Strong Buy” consensus, with 15 Buy, 2 Hold, and 0 Sell recommendations from analysts over the past 3 months. Unlike Wolfe, Wall Street analysts tracked by TipRanks Stocks Comparison Tool project an average price target of $118, with 67% upside potential.

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