Checking if ROBINHOOD MARKETS INC - A (NASDAQ:HOOD) meets Minervini’s stock selection rules

In this article we will dive into ROBINHOOD MARKETS INC - A (NASDAQ:HOOD) as a possible candidate for growth investing. Investors should always do their own research, but we noticed ROBINHOOD MARKETS INC - A showing up in our Minervini growth screen, which makes it worth to investigate a bit more.

Minervini Trend Template Analysis.

HOOD checks all the boxes when evaluating the Minervini Trend Template. This is a set of basic technical criteria to identify stocks in strong uptrends:

• ✔ Relative Strength is above 70.
• ✔ Current price is within 25% of it's 52-week high.
• ✔ Current price is at least 30% above it's 52-week low.
• ✔ The current price is above the 50-, 150- and 200-day SMA price line.
• ✔ The SMA(200) is trending upwards.
• ✔ The SMA(150) is above the SMA(200)
• ✔ The SMA(50) is above the SMA(150) and the SMA(200)

Unpacking HOOD's High Growth Momentum Rating

ChartMill assigns a High Growth Momentum Rating (HGM) to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth and profitability elements, including EPS and revenue growth, accelleration, surprises and revisions. In the case of HOOD, the assigned 6 reflects its growth potential:

Explosive Earnings Growth

• The quarterly earnings of HOOD have shown a 106.0% increase compared to the previous quarter, as revealed in the recent financial report. This growth signifies positive momentum in the company's financials, pointing towards a promising upward trend
• Over the past year, HOOD has demonstrated 1.0K% growth in EPS, signifying its positive financial trajectory and potential for future profitability.
• HOOD has demonstrated strong q2q revenue growth of 50.0%, suggesting a favorable trend in the company's financials and indicating the potential for continued expansion.
• With impressive 1-year revenue growth of 59.65%, HOOD showcases its ability to generate increased sales and revenue. This growth highlights the company's strong customer demand and its effective business strategies.
• HOOD has exceeded EPS estimates 3 times in the last 4 quarters, demonstrating its ability to outperform market expectations. This trend highlights the company's strong financial performance and its potential for future growth.

Financial Strength & Profitability

• With positive growth in its operating margin over the past year, HOOD showcases its ability to improve profitability through effective cost control and operational efficiency. This growth underscores the company's commitment to enhancing its financial performance.
• With positive growth in its free cash flow (FCF) over the past year, HOOD showcases its ability to generate strong cash flows and maintain a solid financial position. This growth reflects the company's efficient utilization of capital and its commitment to long-term value creation.
• HOOD has achieved an impressive Return on Equity (ROE) of 19.99%, showcasing its ability to generate favorable returns for shareholders.
• HOOD's Debt/Equity ratio of 1.14 suggests a healthy balance between debt financing and shareholder equity.

Market Strength & Institutional Confidence

• With 73.95% of the total shares held by institutional investors, HOOD showcases a healthy distribution of ownership. This suggests a mix of institutional and retail investors, fostering a dynamic market for the stock.
• HOOD has achieved an impressive Relative Strength (RS) rating of 98.77, showcasing its ability to outperform the broader market.

How do we evaluate the setup for HOOD?

ChartMill assigns a Setup Rating to every stock to determine the degree of consolidation. This rating, ranging from 0 to 10, is updated daily and evaluates various short-term technical indicators. HOOD currently holds a 2 as its setup rating, suggesting a particular level of consolidation in the stock.

Although HOOD has an excellent technical rating, it does not present a decent entry opportunity at the moment. Price movement has been a little bit too volatile to find a nice entry and exit point. It is probably a good idea to wait for a consolidation first.

Check the latest full technical report of HOOD for a complete technical analysis.

Concluding

More ideas for high growth momentum stocks can be found on ChartMill in our High Growth Momentum + Trend Template screen.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.