Date of Award

5-2025

Degree Type

Thesis

Degree Name

Departmental Honors

Department

Economics and Finance

Abstract

This capstone project presents an in-depth analysis and valuation of Robinhood Markets Inc. (NASDAQ: HOOD). Robinhood Markets is a revolutionary fintech platform aiming to democratize finance and investing.

The company was founded in 2013 in Menlo Park, California by Vladimir Tenev and Baiju Bhatt. The co-founders created an intuitive mobile trading platform and were the first to offer commission-free trading. Robinhood has opened the door to investing to a new demographic through the easy-to-use mobile app, the ability to buy and sell fractional shares (this makes purchasing shares of companies with high share prices accessible to more individuals), in-app financial education, and access to market research and data.

This paper is presenting a buy on Robinhood Markets Inc. (NASDAQ: HOOD) stock based on a current stock price of $42.85 (as of close 4/1/2025), a projected price of $86.89, and a projected upside of 103%.

This recommendation is mainly based on three merits, including: (1) a large and growing online brokerage market which will likely benefit from younger individuals starting to build their wealth on the platform, (2) Robinhood expanding its platform offerings to include more financial products, educational resources, and access to market research and data, and lastly, (3) geographic expansion. These merits will be discussed in further detail later in this paper. Risks of this investment include fluctuating interest rates, uncertainty in the markets that may cause a reduction in trading volume, and geopolitical risks associated with operating and expanding into new foreign geographies. Through a discounted cash flow analysis, comparative analysis, and market research, this paper will demonstrate the quantitative and qualitative merits and risks of an investment in Robinhood Markets.

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Faculty Mentor

Janette Goodridge

Departmental Honors Advisor

Katarzyna Bilicka