- SpaceX is reportedly considering excluding platforms like Robinhood (HOOD) and SoFi from its upcoming IPO in favor of bank-led brokerages.
- Brokerage firm Bernstein significantly lowered its price target for Robinhood to $130 from $160, citing temporary crypto market weakness.
- Robinhood shares fell 2.5% following the price target cut and the SpaceX IPO report, extending a year-to-date decline of nearly 44%.
SpaceX is considering cutting retail brokerages Robinhood and SoFi out of its highly anticipated initial public offering, according to a report from Reuters on Monday. This potential snub contributed to a 2.5% decline in HOOD shares, which also faced a separate price target cut from analysts.
The lead IPO underwriter, Morgan Stanley, is expected to route shares for smaller U.S. retail investors through its own E*Trade platform. However, Robinhood and SoFi, which are not tied to the underwriting banks, reportedly remain in discussions for a potential role.
Consequently, the final allocation plans could still change as the SpaceX IPO approaches in the coming months. Meanwhile, the retail sentiment around Robinhood stock itself remained in ‘bullish’ territory despite the day’s negative news.
In a separate note, brokerage firm Bernstein slashed its price target on Robinhood, as reported by TheFly. The firm maintained an ‘Outperform’ rating but reduced its target to $130 from $160, linking the move to temporary weak sentiment in cryptocurrency markets.
Bernstein analysts believe the current environment is offering significant discounts on crypto-related stocks. The firm stated, “we will see a bottom in crypto stocks into weak Q1 earnings,” suggesting these businesses have long-term growth potential.
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