Can Robinhood Stock Surge To $250?

Robinhood Markets (NASDAQ:HOOD) stock has had a remarkable run in 2025 with the stock trading at roughly $130 per share. Robinhood, best known for eliminating trading commissions and making stock investing more accessible through its user-friendly smartphone app, has seen its stock surge by over 3x since early January. Growth has been driven by earnings momentum, a fast-expanding user base, and growing exposure to the hot cryptocurrency market. The company was recently added to the S&P 500 in September, a structural boost as passive funds and ETFs tracking the benchmark are forced to buy. Q3 earnings were also stronger than anticipated. Revenue roughly doubled year-over-year to $1.27 billion, while net income climbed to $556 million, $0.61 per share, up from $150 million, or $0.17 per share during the same quarter last year.

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So could Robinhood’s stock, now at about $130, surge again to $200 in the next few years? The idea isn’t far-fetched. Consider that the stock was trading at just $55 in mid-May 2025 and has already more than doubled in a little over five months. At roughly 54x trailing earnings, valuations may look stretched at first glance, but when combined with rising profitability, and expanding market opportunities, there’s a plausible path to a $200-plus stock price in the near future. In the sections below, we break down Robinhood’s revenues, margins, and valuation multiples to map out how this scenario could unfold.

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1. Robinhood’s Revenue Growth Potential

HOOD’s revenues have risen considerably from $280 million in 2019 to about $2.9 billion in 2024, translating into an annual growth of almost 60%.  It looks like the momentum can hold up. Consensus projects a close to 53% revenue growth for 2025 to about $4.5 billion, although growth is projected to slow to about 18% for next year. However, there is a real opportunity for HOOD to maintain this average annual rate of close to 35% for the next few years, led by continued customer growth for the company, significant potential in the crypto business, and wealth management solutions.

Considering this, revenues could move from an estimated $4.5 billion in FY’25 to around $8.2 billion by FY’27, or an over 82% increase.  Here’s a closer look at what could drive this growth.

Monetizing a Larger Customer Base: Robinhood has proven to be agile and innovative and has a good understanding of young retail investors, and this has led to strong user growth. Funded customer accounts jumped 2.5 million, or 10%, year-over-year to 26.8 million during the last quarter, while platform assets increased 119% year-over-year to $333 billion. This growing asset base is a revenue engine, enabling more trading activity, higher interest income on idle cash, and greater potential for advisory fees.

Push Into Crypto: Robinhood’s crypto revenues surged 98% last quarter to $160 million, just shy of a sixth straight quarter of triple-digit growth. The company has also been expanding its operations via acquisitions. It closed its purchase of global cryptocurrency exchange operator Bitstamp in June, providing it with over 50 active licenses and registrations internationally, while also strengthening its enterprise efforts by enhancing its lending and staking infrastructure and offering more specialized products tailored for hedge funds, fintechs, and registered investment advisors. A friendlier regulatory climate and growing political support, including from the Trump administration, have further fueled investor enthusiasm for the stock.

A Valuable, Young Demographic: Robinhood’s user base is heavily dominated by millennials and younger investors. There is a massive wealth transfer expected to move from older generations to millennials and Gen Z over the next two decades, running into tens of trillions of dollars. By acquiring these users early, Robinhood positions itself to benefit as their assets and investment needs rise over time. As millennials age, their financial needs will also diversify as time goes by. Considering this, Robinhood has begun offering products beyond just trading – such as retirement accounts, high-yield cash balances, and wealth management tools – to retain users as their financial stature increases. While this may be a longer-term theme for the stock, it is a highly significant one.

New Frontiers: Robinhood has also shown a knack for quickly identifying and scaling into emerging opportunities. A great example being its prediction markets business. Originally launched around the 2024 U.S. presidential election cycle, the product allows users to trade contracts tied to real-world events. Momentum appears strong: in October alone, over 2.5 billion event contracts were traded on the platform, and the product is generating over $100 million in annualized revenue within a year of launch.  The success highlights Robinhood’s ability to leverage its massive retail base, gamified interface, and regulatory agility to move into new businesses.

2. Margins Have Scope To Expand

Combine this robust revenue growth with the fact that HOOD’s adjusted net margins (net income, or profits after all expenses and taxes, calculated as a percent of revenues) are on an improving trajectory. They grew from negative levels in FY’21 to about 35% in FY’24. Growth has been led by strong gains in high-margin revenue channels, such as payment for order flow and margin interest. Strong growth in transaction volumes, particularly crypto, have also been helping the company.  Robinhood’s model also has considerable operational leverage, since costs do not necessarily rise with revenues.

Much of its cost base — including tech infrastructure, compliance, and support — is largely fixed or scales only slightly with user growth. In effect, each additional dollar of revenue could add disproportionately more to profits. Margins could potentially trend still higher to levels of about 40% considering these trends. Now, combining 40% adjusted net margins, with about $8.2 billion in revenue, and we’re talking about earnings of about $3.3 billion. That’s a roughly 3x increase from levels seen in 2024.

3. Lower P/E Contraction, Stronger Earnings Drive Higher Stock Price

Now, if earnings grow 3x, the price-to-earnings multiple will shrink by 3x, from levels of about 21x, assuming the stock price stays the same. But that’s exactly what HOOD investors are betting will not happen. If earnings expand 3x over the next few years, instead of the P/E shrinking from a figure around 54x now to about 18x, a scenario where the PE metric stays at about 35x looks more likely, as strong growth and improving margins give investors more confidence about HOOD stock’s future.

The company’s addition to the S&P 500 could also help sustain a richer multiple, given the added visibility, index fund flows, and broader institutional participation that typically come with inclusion. This would make the growth of HOOD stock to levels of over $250 within the next few years a real possibility. So what about the time horizon for this high-return scenario? While our example above illustrates a roughly two-year time frame, in practice, it won’t make much difference whether it takes two years or three, as long as HOOD is on this revenue expansion trajectory, with margins holding up, the stock price could respond similarly.

The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.

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