Robinhood stock price is stuck in a bear market after falling by nearly 30% from its highest level in 2025. Its drop accelerated on Thursday after the new developments on the CLARITY Act in the US Senate. It moved to a low of $110, its lowest level since October last year. This article explores whether it is a good buy today.
Why Robinhood stock has crashed
There are a few reasons why the Robinhood stock price has crashed in the past few months. First, the decline is happening as investors book profits after the strong surge that happened last year when it became the best gainer in the S&P 500 Index. It is common for stocks to drop after experiencing a strong surge over time.
Second, in line with the first point, the stock dropped after the company entered the S&P 500 Index last year. In most cases, companies surge after entering a major index since this leads to forced buying by fund managers. The stock then loses momentum a few months later as the buying eases.
Third, HOOD stock retreated on Thursday after the Senate Banking Committee paused the progress on the closely-watched CLARITY Act in the United States. This pause happened after Coinbase, the biggest cryptocurrency exchange in the country withdrew its support, citing the limitations to stablecoin rewards.
Robinhood’s Vlad Tenev noted that his company still supported the legislation because it would allow it to offer staking solutions to its customers.
While Robinhood is known for stocks and options, its crypto business is still growing. It offers crypto services through its main product and Bitstamp, the company it acquired last year.
Further, in line with this, the decline happened because of the crypto market crash that happened and accelerated in the fourth quarter. Bitcoin bottomed at $80,000 from its all-time high of $126,300 in October. Activity in the crypto industry often eases whenever Bitcoin and other altcoins are falling.
Robinhood stock fell because of valuation concerns. While its multiples have improved, the company remains highly valued, with its forward price-to-earnings ratio rising to 50, higher than the sector median of 13.
Robinhood has major catalysts
Still, despite its challenges, Robinhood has some major catalysts ahead. For one, it has become a major player in the tokenization industry. It launched hundreds of tokenized stocks in Europe and there is a likelihood that it will expand the service to other countries.
Robinhood’s business is expected to keep growing as new products start to mature. The average estimate is that its annual revenue in 2025 was $4.53 billion, up by 53% YoY, while its earnings-per-share rose to $2.03, up from $1.56. The company’s revenue is then expected to hit $5.52 billion this year.
Robinhood has also continued to gain its market share in the trading industry because of its popularity among young people. This explains why its user count has continued growing in the past few years despite the stiff competition in the industry.
Additionally, analysts are highly bullish on the stock, with the average estimate among analysts being at $149, much higher than the current $110.
HOOD stock price technical analysis
Robinhood stock chart | Source: TradingView
The daily timeframe chart shows that the HOOD stock price has come under pressure in the past few months as it plunged from $153 to $110 today.
It has remained below the descending trendline that connects the highest swings since October 31st.
A closer look shows that it has formed an inverse head-and-shoulders pattern, a common bullish reversal sign in technical analysis.
Therefore, the stock will likely bounce back in the coming weeks as investors attempt to retest last year’s high of $153. This view will be confirmed if it moves above the descending trendline
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