Robinhood Markets Inc (HOOD) Emerges as a Top High-Growth Momentum Candidate

Robinhood Markets Inc, A (NASDAQ:HOOD) has appeared as a notable candidate for investors using a disciplined growth and momentum strategy. The selection process joins Mark Minervini's strict Trend Template with a High Growth Momentum (HGM) screen, intending to find companies that are not only in strong technical uptrends but also display very high fundamental growth. This two-part process tries to find stocks with the possibility for major price increase by confirming they have both the technical strength behind them and the fundamental driver of fast business growth.

Technical Strength and the Minervini Trend Template

The main part of the Minervini strategy is its Trend Template, a group of technical rules made to filter for stocks in a confirmed and strong stage 2 uptrend. HOOD currently meets these conditions, which is important for the strategy as it concentrates on strength and momentum instead of trying to pick bottoms.

• Price Above Key Moving Averages: HOOD's current price trades well above its rising 50-day, 150-day, and 200-day simple moving averages. This arrangement confirms a strong bullish trend across multiple timeframes.
• Moving Average Alignment: The 50-day SMA is above the 150-day SMA, which is in turn above the 200-day SMA. This "stacked" setup is a classic sign of a good, speeding up uptrend and shows that buyers are in firm control.
• Proximity to Highs: The stock is trading within 25% of its 52-week high, a key Minervini rule that forces focus on market leaders, not laggards. Stocks near their highs often have the momentum to keep going up.
• Significant Recovery: HOOD's price is much more than 30% above its 52-week low, showing a powerful recovery trend and basic strength.
• Superior Relative Strength: With a ChartMill Relative Strength (CRS) ranking of 98.69, HOOD is doing better than nearly 99% of all stocks in the market. Minervini states that high relative strength is a sign of market leaders and is often a sign of further outperformance.

Fundamental Firepower for High Growth Investors

While the Trend Template finds the "when," the High Growth Momentum screen finds the "why" by locating companies with outstanding fundamental growth. HOOD's financial numbers show a company going through very fast growth, a key quality for this strategy which states that "big earnings attract big attention" from institutional investors.

• Explosive Earnings Growth: The company's earnings per share (EPS) growth is very high. Key numbers include:
  • EPS Growth (TTM): 497%
  • EPS Growth (Last Quarter YoY): 100%
  • EPS Growth (Previous Quarter YoY): 105.6%
• Strong Revenue Acceleration: Top-line growth is also very high, showing expanding market share and demand for its services:
  • Revenue Growth (TTM): 59.4%
  • Sales Growth (Last Quarter YoY): 45.0%
• Analyst Confidence and Profitability: The fundamental view is made stronger by upward changes from analysts and strong profitability.
  • Next Year EPS Revisions (3 Months): +37.4%
  • Profit Margin (Last Quarter): 39.0%

This mix of high earnings, strong sales growth, and getting better analyst feeling creates the fundamental "catalyst" that Minervini's SEPA (Specific Entry Point Analysis) process looks for, suggesting the company's growth story is still getting recognition.

Technical Health Overview

The provided technical report gives HOOD a perfect rating of 10 out of 10, calling it a top-level performer from a technical view. The analysis confirms both its long-term and short-term trends are positive, and it is trading near its 52-week high. The stock shows very high relative strength, doing better than 99% of its peers in the Capital Markets industry. While the overall technical health is excellent, the report notes that the current setup rating is medium, suggesting that after a major advance, the stock may gain from a time of consolidation before offering a new good entry point. For a detailed breakdown, you can look at the full technical analysis report for HOOD.

Finding Similar Opportunities

For investors interested in using this same strict screening process to find other high-growth, technically sound stocks, the process used to find HOOD is easily available. You can look at current market candidates that meet these joined rules by using the High Growth Momentum + Trend Template screen on ChartMill.

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