Is Robinhood Markets Inc (HOOD) overvalued?
On Equity Rank's model estimate, HOOD trades 118% above its fair value. Robinhood Markets Inc (HOOD) last closed at $80.91; the multi-method model fair value is $37.03.
| Price | Model fair value | Price vs model |
|---|---|---|
| $80.91 | $37.03 | 119% above |
What the answer rests on
- 0 of 8 valuation methods put HOOD's value above its price and 8 put it below, so the methods mostly agree.
- To justify today's price, HOOD's free cash flow would need to grow about 22.9% a year for ten years (a reverse discounted cash flow).
- HOOD trades at 40.3 times its last year's earnings, against a median of 26.9 for 8 profitable Fintech companies.
- Over the past year the price sat below the model fair value on 0% of trading days. The gap ranged from 47% above to 324% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind HOOD's fair value · What prices assume · Other companies