Stock Market Today, June 17: Robinhood Jumps After Announcing 10% Workforce Reduction, Record June Volumes

Robinhood Markets (NASDAQ:HOOD), a commission-free retail brokerage and multi-asset investing platform, closed at $105.20, up 8.78%. On Wednesday, the company announced a planned 10% workforce reduction and record June month-to-date volumes, prompting analysts to raise price targets. Trading volume reached 69.9M shares, coming in about 128% above its three-month average of 30.6M shares. Robinhood Markets IPO’d in 2021 and has grown 202% since going public.

How the markets moved today

The S&P 500 fell 1.19% to 7,422, while the Nasdaq Composite dropped 1.34% to 26,022. Among retail brokerage and fintech financial services peers, Interactive Brokers Group rose 2.14% to $95.09, while The Charles Schwab added 0.90% to $94.51, highlighting a mixed session for brokerage names.

What this means for investors

On Wednesday, Robinhood announced it would reduce its headcount by 10%, stating that it “is taking this action from a position of strength.” The company went on to report that June month-to-date volumes were at record levels across equities, options, and prediction markets, lending credence to the notion that the workforce reduction isn’t necessarily a reactive move but rather a proactive one.

Following these news items, an analyst at Argus raised their price target on Robinhood from $90 to $110, while a couple of other investment firms also inched their price targets higher. While HOOD stock trades at a slightly lofty 52 times forward earnings, it grew sales by 15% and Gold subscribers by 34% in its latest quarter. Immensely popular among younger generations, Robinhood could be a great investment if it can grow alongside its young user base.

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