Morgan Stanley upgrades Robinhood, sees $150 price target on user monetization strength

Morgan Stanley analyst Michael Cyprys has upgraded Robinhood Markets to Overweight from Equal Weight, setting a new price target of $150, up from $124. The thesis is straightforward: Robinhood doesn’t necessarily need more users to grow. It just needs to squeeze more revenue out of the ones it already has.

And the numbers suggest that’s already happening. Average revenue per user climbed 24% year-over-year to $187 in Q2 2026, even as the funded customer base grew a more modest 7% to 28.4 million accounts.

The prediction markets surprise

Perhaps the most striking detail buried in Robinhood’s Q2 results: event contracts and prediction markets pulled in $156 million in revenue. That’s more than crypto trading generated in the same quarter, which came in at $100 million.

13 business lines, each clearing $100M

Robinhood now operates 13 distinct business lines, and every single one generates more than $100 million in annualized revenue. The company’s full-year 2025 revenue hit $4.5 billion, a 52% jump from the prior year. Total platform assets reached $369 billion by mid-2026, supported by trailing 12-month net deposits of roughly $76 billion.

Gold subscribers reached 4.8 million in Q2 2026, a 39% increase year-over-year.

Why Morgan Stanley is betting on monetization over acquisition

A 7% year-over-year increase in funded accounts is respectable but not explosive. What’s explosive is the 24% jump in ARPU. Morgan Stanley’s thesis is that Robinhood’s expanded product suite, spanning equities, options, crypto, prediction markets, retirement accounts, credit cards, and wealth management, creates compounding opportunities to monetize each user across multiple touchpoints.

Cyprys is essentially arguing that the market has been undervaluing this dynamic. The previous Equal Weight rating and $124 target suggested Robinhood was fairly priced. The new Overweight call and $150 target say there’s meaningful upside left as these monetization trends continue to compound.

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