Bernstein Sees 78% Upside in Robinhood-If Prediction Markets Really Become Its Next Cash Engine

Bernstein's $160 target comes as Robinhood's revenue mix already has shifted

What makes Bernstein's call stand out is not just the price target. It is the timing. Robinhood's revenue mix has already shifted away from the story most investors still associate with the stock. In the second quarter, prediction-market trading produced $156 million, ahead of $129 million from equity trading and $100 million from crypto trading.

Bernstein lifted its target to $160 from $130, and another source tied to that call points to 78% upside from the stock's recent area near just under $100. According to The Defiant, the target is based on a 35-times forward earnings multiple on $4.56 of 2028 EPS, a profit estimate about 36% above Wall Street consensus. That leaves the core debate simple: are prediction markets a temporary trading spike, or the start of a broader monetization shift for Robinhood?

The near-term catalyst is visibility. Robinhood was scheduled to present at the Bernstein Strategic Decisions Conference on Wednesday, May 27, 2026, giving investors a fresh chance to hear management explain how quickly these newer products are scaling.

Why bulls think prediction markets can become durable revenue

The real question is not whether prediction markets had a good quarter. It is whether that demand can become a repeatable cash stream. Bulls argue it can, because event contracts give users something to trade even when traditional markets are flat or directionless. That helps explain why the category can stay interesting even when broader trading activity softens even in a flat-to-down market.

The bullish case rests on platform leverage

Robinhood already has 14 million monthly active users. If a growing share of that base moves into event contracts, perpetual futures, and tokenized equities, the company may not have to buy every new dollar of revenue from scratch. Bernstein expects those newer businesses to rise from about 3% of total revenue in 2025 to roughly 18% in 2027 and about 23% in 2028. If that shift holds, Robinhood would be becoming less dependent on traditional trading cycles.

Why skeptics still see a headline-driven business

Skeptics are not arguing that prediction markets had a weak quarter. They are arguing that the category is still young and could cool quickly if attention shifts elsewhere. Bernstein's own growth assumptions are aggressive, so the thesis weakens if user engagement proves concentrated around a few major events rather than sustained through the year.

There is also a competitive and structural watchpoint. Robinhood is still distributing Kalshi contracts while building its own venue through Rothera, which currently accounts for about 16% of Robinhood's total event-contract volume. Bulls see that arrangement as a bridge that buys time to learn pricing and build scale. Bears see it as a sign that the economics may remain less attractive until more activity moves onto Robinhood's own platform.

What would make the thesis more credible

The case becomes more durable if:

• engagement stays strong across multiple events, not just at launch;
• a larger share of activity migrates through Rothera over time; and
• prediction markets grow without a simultaneous slowdown in Robinhood's legacy businesses, including equity trading and crypto trading.

If the current momentum is only early adoption, investors will want to see it turn into repeat usage rather than a one-product narrative.

What investors should watch next: the conference, then earnings

The next practical checkpoint is second-quarter earnings on July 29. That report comes after the Bernstein Strategic Decisions Conference, so investors should already have some fresh commentary from management on how these products are scaling. The conference can improve visibility, but the earnings release is where the stronger bull case gets its first real test.