Robinhood (HOOD): Model Update

We are marking our model ahead of 3Q26 earnings, and our JPMe EPS rises to $0.57 (previously $0.46). Transaction revenue moved most significantly higher (JPMe $914mn) after marking for Robinhood's quarterly record volumes in equities and options. We also took up numbers in prediction markets (JPMe 15.8bn contracts), supported by persistently elevated volumes in 3Q even after World Cup success—we estimate Robinhood's own Rothera made up ~23% of these volumes. In net interest revenue (JPMe 3Q26 $437mn), we expect minimal impact of September's rate hike, but we model two subsequent hikes through 2Q27 to reflect current curve expectations. In expenses, we model $790mn adj. opex and SBC ex-credit losses in 3Q26—leading to FY26 adj opex of $2,820mn, at high end of the guided range of $2,700mn - $2,825mn. Our rating remains unchanged, but we are establishing our Dec-2027 price target of $115, based on 32x FY27E EPS.