Deutsche Bank is optimistic about Robinhood’s (HOOD) stock, reiterating a ‘buy’ rating and raising its price target to $98. This positive outlook is fueled by Robinhood’s expansion into prediction markets via its backed platform, Rothera. The move, especially with the upcoming 2026 World Cup, is expected to drive user engagement and contract volume.
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Robinhood (HOOD) is making a significant strategic move into the prediction markets, a development that Deutsche Bank believes could catalyze a turnaround for the trading platform's stock. The stock, which has seen a decline of over 40% from its 52-week high, received a renewed vote of confidence from the bank, which reiterated its 'buy' rating and boosted its price target to $98, implying an 11% upside from recent trading levels.
This strategic pivot was announced with Robinhood beginning to direct some of its event contracts to Rothera, a prediction market it co-backed with Susquehanna International Group. Initially, contracts related to major events like the World Cup and professional baseball will be routed to Rothera. Analyst Brian Bedell highlighted this move as a significant potential boost, given Robinhood's existing high volume of event contract processing.
"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," Bedell noted in a Friday report. While Robinhood will continue to offer event contracts from other platforms like Kalshi and ForecastEx (a venture with Interactive Brokers), the fee structure on Rothera is poised to attract more traders.
Rothera's fee cap of just 1 cent per contract is competitive, matching ForecastEx and undercutting Kalshi's maximum of 2 cents per contract. "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," Bedell added. This recalibration of fee structures and the integration of Rothera are seen as key elements in Robinhood's strategy to enhance customer value and drive greater user participation in prediction markets.
