Six Months On From Its IPO, Robinhood Is Struggling

Six Months On From Its IPO, Robinhood Is Struggling
Andrew Rummer

about 2 years ago1 min

Mentioned in story

Six months after its high-profile initial public offering (IPO) and 12 months after the GameStop trading frenzy that helped its transition to household name, Robinhood stock is struggling. 

The retail-focused brokerage sold shares at $38 on July 28th and they began trading the next day. The stock was briefly caught up in its own meme-stock frenzy the following week, peaking at $85. But it’s been one-way traffic ever since.

Robinhood burnished its image as a champion of smaller investors by allowing them to order shares in its IPO, something that’s usually reserved for big institutions. But the chart shows how, unfortunately, anyone who did is currently sitting on a 69% loss. That’s an even worse performance than the average IPO over the period, as indicated by the Renaissance IPO exchange traded fund (in pink). 

And Robinhood shareholders shouldn’t expect any respite soon. The stock was down another 15% to less than $10 as of 5am in New York pre-market trading on Friday after results reported late Thursday disappointed investors. The broker’s forecast for first-quarter revenue was well short of estimates and its tally of monthly active users actually fell. 

For now at least, Robinhood is looking like a case study of the dangers of getting caught up in buzzy market debuts.



All the daily investing news and insights you need in one subscription.

Disclaimer: These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment advisor.

/3 Your free quarterly content is about to expire. Uncover the biggest trends and opportunities. Subscribe now for 50%. Cancel anytime.

© Finimize Ltd. 2023. 10328011. 280 Bishopsgate, London, EC2M 4AG