Bernstein sees Robinhood offsetting downside as analysts map out crypto-driven bear case scenarios

Analysts at research and brokerage firm Bernstein said Robinhood (Nasdaq: HOOD) has levers to cushion potential downside from a prolonged crypto slowdown, even as they map out several bear case scenarios tied to retail trading and digital asset cycles.

In a note to clients on Tuesday, the analysts led by Gautam Chhugani said the stock's recent pullback has pushed it closer to an attractive valuation range, though near-term volatility could persist.

Robinhood shares are down about 21% year-to-date and roughly 41% from their peak to $89.91, as of Monday's close, a decline Bernstein attributes in part to the broader crypto drawdown. Crypto trading currently accounts for about 21% of the company's total revenue, the analysts said, leaving investors focused on whether the current downturn represents a temporary pause or a more sustained contraction in retail risk-taking.

Downside scenarios framed by the crypto cycle

To frame that uncertainty, the Bernstein analysts outlined three downside scenarios. In the first, bitcoin BTC falls to around $60,000 and remains subdued for roughly two years, pushing crypto trading volumes back to pre-Trump election levels, while equity options volumes continue to grow. Under that scenario, the analysts estimate 2027 earnings per share of about $3.10 and a potential share price range of $46 to $61 based on compressed valuation multiples.

The second scenario assumes bitcoin dips to $60,000 but recovers in the second half of 2026, leaving equity options volumes largely intact. That case implies 2027 earnings per share of roughly $3.50 and a potential share price range of $70 to $88, the analysts said.

In the most bearish outcome, both crypto and equity options volumes decline by 50% over two years, reflecting what Bernstein describes as a peak retail risk cycle. That scenario results in estimated 2027 earnings per share of $2.40 and a potential share price range of $24 to $36, they said.

Despite those downside cases, the Bernstein analysts said Robinhood's broader business mix could help offset weaker crypto activity. The firm highlighted growth in equity trading, prediction markets, and banking services, noting that non-trading revenue now represents about 43% of total revenue and has grown at a roughly 29% compound annual rate over the past two years.

The analysis builds on Bernstein's broader view that the current crypto downturn may be temporary. In prior research, the firm said it expects a "short-term crypto bear cycle" to reverse in 2026, with bitcoin potentially bottoming around the $60,000 range before recovering.

Against that backdrop, Bernstein reiterated its outperform rating on Robinhood with a $160 price target, saying investors need to look beyond near-term crypto volatility when assessing the stock's longer-term outlook.

Gautam Chhugani maintains long positions in various cryptocurrencies. Certain affiliates of Bernstein act as market makers or liquidity providers in the equity securities of Robinhood.