The security is plummeting after a third-quarter revenue miss
Robinhood Markets Inc (NASDAQ:HOOD) stock was last seen down 13.1% to trade $8.48, after the financial services concern reported a third-quarter revenue miss of $467 million amid slowing trading activity. Transaction-based revenue fell 11% year-over-year to $185 million.
No fewer than four analysts have cut their price targets in response, including Deutsche Bank and Barclays to $9 from $10. This is notable since the brokerage bunch is already firmly bearish, with 10 of the 13 firms in coverage sporting a tepid “hold” or worse rating.
Today’s drop has the shares breaching support at the $8.80 region, which contained their October pullback. A ceiling at the $10 level has been enacting pressure since September, while the 50-day moving average has been pressuring HOOD longer still. The security is pacing for its worst day in roughly one year, but still sports a 19.9% year-to-date lead.
At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), HOOD sports a 50-day call/put volume ratio of 8.74 that ranks higher than 97% of annual readings. This means option traders have been more bullish than usual.
Drilling down to today’s options activity, 40,000 calls and 15,000 puts have already been traded, volume that’s 10 times the intraday average amount. Most popular is the weekly 12/1 11-strike call, with positions being bought to open there.