Robinhood Markets, Inc. (HOOD) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: Robinhood Markets, Inc.

Updated on October 28, 2026 · accounts published on October 27, 2026

Reading of October 27, 2026: A fast-growing, highly profitable financial business that carries heavy leverage

Robinhood Markets trades at a P/E of 41.7 over the last 12 months, 220 % above its sector median, while revenue grew 52 % in the same period.

• Is Robinhood Markets expensive or cheap? Its P/E of 41.7 over the last 12 months is 220 % above the 13.0 median of 324 financial services companies.
• How is the business doing? Revenue grew 52 % over the last 12 months, but the operating margin of 40 % is below the 47 % of fiscal 2025.
• How strong is the balance sheet? Debt to equity was 1.68 in fiscal 2025, more than three times the 0.5 that counts as prudent in financial services.
• What to expect from the next earnings? 20 of 26 analysts rate it a buy and expect EPS of $0.63 in the quarter due on February 9, 2027.
• Is it a scalable business with little leverage? It passes three of five sector tests, with revenue per share up 35 % a year over 2020-2025, but fails on leverage.

Is Robinhood Markets expensive or cheap?

Robinhood Markets trades at a P/E of 41.7 over the last 12 months, 220 % above the 13.0 median of its sector. The other measures say the same thing: an earnings yield of 3.7 %, a free cash flow yield of 3.1 % and a P/B of 8.4×. The premium has held through a hard year for the stock. It is down 35 % over the last 12 months and sits 36 % below its 52-week high of $147.08, against a low of $65.16. The market is still paying for growth well above the sector's, so the multiple only holds up if that growth continues.

How is the business doing?

Revenue rose 52 % year on year over the last 12 months and EPS rose 31 %, so profits grew more slowly than sales. Profitability is still high. The operating margin was 40 % over the last 12 months, down from 47 % in fiscal 2025, and the net margin was 49 %. A net margin above the operating margin means something below the operating line added to profit, and items like that are usually harder to repeat. ROE of 21 % over the last 12 months shows the company earns a solid return on shareholders' equity.

How strong is the balance sheet?

Debt to equity stood at 1.68 in fiscal 2025. In financial services a company counts as prudent below 0.5, so Robinhood Markets fails that test by a wide margin. Cash quality is closer to the line: free cash flow covered 84 % of net income in fiscal 2025, just short of the 90 % considered healthy. Put together, most of the reported profit is backed by cash. The company does carry much more debt relative to its equity than the sector benchmark allows, which leaves less room for error if revenue growth slows.

What to expect from the next earnings?

In the results published on October 27, 2026, Robinhood Markets reported EPS of $0.60 against $0.56 expected, a 7.5 % beat. It has beaten EPS estimates in 7 of the last 8 quarters. Analysts have been raising their forecasts: over the last 30 days the 2026 EPS consensus rose 2.6 %, from $2.15 to $2.21 across 20 analysts, and the revenue consensus rose 1.8 %. For the quarter due on February 9, 2027 they expect EPS of $0.63. Of 26 analysts, 20 recommend buying, 4 holding and 2 selling, so the bar going into that report is high.

Is it a scalable business with little leverage?

Asset managers, brokers and fintechs are not banks. For them the useful checks are revenue growth, fee-driven margins and how much profit turns into cash. On scalability, Robinhood Markets clears the bar easily. Revenue per share grew 35 % a year over fiscal 2020-2025, against a healthy threshold of 6 %, and the fiscal 2025 operating margin of 47 % beats the 30 % mark. ROE of 21 % over the last 12 months is above the 15 % threshold. The weak spots are cash conversion, borderline at 84 % against 90 %, and debt to equity of 1.68, far above 0.5.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.