Jefferies began coverage of Robinhood Markets with a Buy recommendation and an $88 price objective, saying the company is positioned to broaden its role beyond retail brokerage into a comprehensive financial services "super app." The brokerage house framed Robinhood as well placed to capture rising retail participation and to attract the next generation of investors.
Valuation and investment thesis
Jefferies noted the stock trades at 26 times its 2027 earnings estimate and described that multiple as offering an "attractive entry point." The bank's note emphasizes that Robinhood could benefit from what Jefferies estimates is a roughly $100 trillion generational wealth transfer, and that its customer-facing position gives it a "unique ability to attract the next-gen investor."
Customer and balance-sheet trends
The firm flagged several recent operational metrics to support its view. Funded customers numbered 27.4 million in February, an increase of 7 percent year over year. Total platform assets rose 68 percent to $314.2 billion. Net deposits for February were reported at $5.6 billion, which Jefferies said is in line with the 12-month average.
While the report concedes that trading activity has moderated in the near term, Jefferies described the longer-term growth outlook as constructive and pointed to improving profitability as a key offset to softer engagement.
Revenue mix and product expansion
Jefferies singled out the company’s rapid rollout of new offerings - including initiatives spanning tokenization and custody - as important drivers of revenue diversification. The note details a shift in revenue composition: non-transactional revenues account for 41 percent of total revenues now, up from 23 percent in 2021. Jefferies projects that non-transactional revenue will rise to 43 percent in both 2026 and 2027.
Profitability outlook
On margins, Jefferies expects adjusted EBITDA to strengthen materially, forecasting adjusted EBITDA margins of 58.2 percent in 2027. The brokerage argues that as revenue diversifies away from transaction-centric streams and the company scales newer products, profitability should continue to improve.
Jefferies presents a constructive view of Robinhood’s evolution from a retail broker into a broader financial services platform, citing customer growth, asset expansion, diversification of revenue sources and margin expansion as central pillars of its Buy initiation and $88 target.