Robinhood (HOOD) stock climbed about 3% in premarket trading on Tuesday after Morgan Stanley upgraded the stock and lifted its price target.
Analyst Michael Cyprys moved his rating to Overweight from Equal-weight and raised his price target to $150 from $124. That new target implies around 43% upside from recent prices.
HOOD was trading around $105 heading into Tuesday’s session, with the premarket move putting it closer to $108.
Cyprys said the upgrade comes down to one key idea: Robinhood’s platform is getting better at making money from the customers it already has, not just adding new ones.
He pointed to assets per customer rising 23% year over year. Gold subscribers, Robinhood’s premium tier, hold around 4.2 times the assets of the average customer.
Robinhood now has 13 separate business lines each generating more than $100 million in annualized revenue. That kind of diversification means fewer single points of failure for revenue.
Prediction markets are a useful example here. Fewer than 2 million users generated $156 million in second-quarter revenue from that product alone.
Cyprys raised his 2026 to 2028 earnings estimates by 12% to 15%, reflecting his more optimistic view on how the platform’s product expansion translates into profit.
Morgan Stanley is forecasting a 23% revenue compound annual growth rate through 2028, reaching $8 billion. That sits about 6% above Wall Street consensus.
The bank also sees EBITDA margins expanding from 48% to 53% as the company keeps a handle on expenses while revenue grows.
Morgan Stanley flagged several near-term events worth watching. The HOOD Summit on September 29-30 is one, along with product launches including Rothera, perpetual futures, and agentic trading.
The $150 price target is based on a 25 times multiple applied to 2031 probability-weighted earnings.
Cyprys also believes investors are underestimating how much the existing 28 million customer base can contribute to revenue growth, without needing a surge in new funded accounts.
Wall Street broadly agrees with the positive view. HOOD carries a Strong Buy consensus rating based on 16 Buy ratings and 2 Holds.
The average analyst price target across Wall Street sits at $125.11, implying about 19% upside. HOOD stock is down around 7% year-to-date heading into September.
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