Robinhood trading APP stock continues to lose market confidence. Despite the strong disposals that hit it from the IPO launched at the end of July 2021, for many analysts the stock deserves a “sell” rating.
The latest downgrade came from analysts at Goldman Sachs, who cut the valuation after other banks that accompanied the group on its stock debut, such as JP Morgan Chase, indicated they were bearish on the stock.
In particular, Goldman analyst William Nance motivated the downgrade with the continued weakness reported by the trading APP in user growth.
“We believe that accelerated user growth is the key condition to revise the rating upward,” Nance wrote, in a note reported by Bloomberg.
The news agency talks about a perfect storm for Robinhood shares: losses are increasing, the number of monthly active users and average revenue per user (ARPU) are also falling.
The stock on Wall Street discounts the rejection of Goldman Sachs, yielding more than 5% in the premarket, at a value less than 70% of the IPO placement price (of 38 dollars) and down 84% compared to to the records tested last August.
It is certainly not a good time for the trading APP so loved by Millennials and Generation Z, in general by amateur traders, which became popular with users of the Reddit social network at the beginning of 2021, hand in hand with the fever. exploded on meme stocks.