FTX May Buy Robinhood, Shares Rise [u]

Sam Bankman-Fried is acting once again to take advantage of significantly lower valuations in a struggling marketplace. Rumors claim that Bankman-Fried is looking to purchase Robinhood via his crypto exchange FTX. While no deal yet, the rumblings have caused shares in Robinhood (NASDAQ:HOOD) to rise in price.

Currently, Robinhood is trading about 15% higher than the market open at around $9.20 a share. Robinhood’s market cap is set at $7.7 billion. But today’s trading range is in stark contrast to the company’s initial public offering of over one year ago when shares were priced at $38 each. Following the IPO, Robinhood shares hit a high of $85 (according to Yahoo) but it has been a long slide down since then representing significant value destruction.

Robinhood’s Q1 earnings report was not encouraging as it reported a 43% decline in net revenues from the year prior going from $522 million to just $299 million. Robinhood reported a loss of $392 million or $0.45 a share. Robinhood blamed the poor performance on “customers affected by the macroeconomic environment.”

Reports indicate that Robinhood has not received an official offer but as Robinhood is a reporting company you can anticipate a comment on the rumors soon – whether it is a denial or acknowledgment that talks between the two firms are taking place.

Update: Bankman-Fried has issued a statement denying there are any talks to purchase Robinhood adding they may be partnering with them in the future.



Sponsored Links by DQ Promote

 

 

Send this to a friend