Trading powerhouse Robinhood is making strategic inroads into the burgeoning prediction markets, a move that Wall Street giant Deutsche Bank believes could be a game-changer for its stock. Despite a recent slump of over 40% from its 52-week peak, Deutsche Bank has reiterated a "buy" rating on Robinhood shares, bumping its price target to $98 – signaling a potential 11% upside from Thursday's closing price.
The optimism stems from Robinhood's recent announcement regarding its event contracts. The company confirmed it is now directing a portion of these contracts to Rothera, a prediction market platform developed through a joint venture with Susquehanna International Group. Initially, select event contracts tied to major sporting spectacles like the World Cup and professional baseball will be channeled through Rothera.
Analyst Brian Bedell of Deutsche Bank highlighted that this integration is poised to significantly boost Robinhood, which already handles a substantial volume of event contracts. Bedell noted, "Today's Rothera launch is strategically timed with the 2026 World Cup to drive engagement on this fast-growing asset class, which has already seen over 16bn contracts traded year-to-date in 2026."
While Rothera will now handle a segment of these contracts, Robinhood will continue to offer event contracts from established platforms like Kalshi and ForecastEx, which is Interactive Brokers' prediction market solution. However, Rothera is expected to carve out a competitive edge through its attractive fee structure. Bedell pointed out that Rothera's fees are capped at a mere 1 cent per contract, mirroring ForecastEx but notably lower than Kalshi's maximum of 2 cents per contract.
Bedell concluded, "The new exchange, combined with a revised lower-fee structure, (albeit maintaining consistent levels of monetization) confirms management's prior message of providing a best-in-class pricing for prediction markets to customers, and we updated our volume forecasts to better reflect potentially greater user participation."
Correction: This article has been updated to reflect the accurate status of the Rothera platform's launch. An earlier version incorrectly stated that Thursday's announcement did not constitute an official launch.
