Source: Seeking Alpha
Shares of American financial services firm Robinhood Markets slipped on Wednesday following a rating downgrade from Atlantic Equities. HOOD is down 3.53%, while COIN is up 3.23%.
- Robinhood shares fell by 2.6% on premarket trading and fell even lower by 4.36% when the market officially opened.
- The decline comes after Atlantic Equities analyst John Heagerty slapped a neutral rating on the firm, down from underweight previously.
- The downgrade was attributed to issues with the steep decline of Robinhood users and the average revenue per user.
- Heagerty flagged the possibility of a further decline amid the return to pre-pandemic behavioral trends and a possible recession.
- He also noted the decline in the valuations of cryptocurrencies, which will hit volumes and order value.
- Annual revenue for the year is expected at 10% before scaling up to 25% by 2023. A negative adjusted EBITDA is seen until 2025.
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