Bernstein sees upside for Robinhood after S&P 500 inclusion and tokenization push

In a note to clients on Tuesday, analysts at research and brokerage firm Bernstein argued that Robinhood is no longer just a hub for speculative retail traders but an emerging financial "super-app" with vast headroom for expanding market share following its S&P 500 inclusion.

Robinhood was added to the index late Friday alongside AppLovin and EMCOR Group, effective Sept. 22, while Michael Saylor's Strategy was snubbed despite meeting all the criteria. The next rebalancing is scheduled for December.

Bernstein estimates Robinhood controls 12% of the U.S. retail trading revenue market across equities and crypto, up from 7% just two years ago. Its spot equity trading market share has increased from 2.8% in 2023 to 5.5% in 2025, while its equity options dominance has more than doubled since 2023, accounting for 24% of retail volume. Crypto retail trading has become another key driver, with Robinhood's market share surging to around 30% following the collapse of FTX and Binance.US's retreat from the country.

The analysts, led by Gautam Chhugani, also highlighted that fears of competition from incumbents like Charles Schwab entering the crypto space have been overstated, with both Coinbase and Robinhood holding their take-rates on advanced traders (55-60 bps), while Robinhood has quietly raised fees in recent quarters. The next frontier, Bernstein argues, is blockchain tokenization — an area where Robinhood could help build a liquid market for securities in the U.S., particularly for private equity.

Beyond trading, Robinhood's biggest opportunity is expanding into wealth management and broader financial services, the analysts said, currently representing just 2.7% of the total broking and advisory market. The company's Gold subscription program now counts 3.5 million members paying $5 per month, with perks including higher savings rates, credit card access, mortgage offers, and private banking-like features. Its Gold credit card, positioned as an aspirational financial club membership, already has 300,000 cards issued, with a waitlist still growing.

With revenues projected to grow from $2.9 billion in 2024 to $6.8 billion in 2026 — at a 51.7% CAGR — Bernstein values Robinhood at $160 per share, implying 36% upside from its $117.28 close on Monday — up 15.8% for the day, according to The Block's HOOD price page.

The analysts praised Robinhood management's "best-in-class product velocity and monetization," while cautioning that regulatory risks around payment for order flow and crypto trading remain an overhang.

Gautam Chhugani maintains long positions in various cryptocurrencies. Certain affiliates of Bernstein act as market makers or liquidity providers in the equity securities of Robinhood and Coinbase.