The Best Stocks to Buy Now: Why Robinhood Stock Merits Attention After 50% Pullback

When market corrections create genuine buying opportunities, investors face critical decisions about which securities deserve fresh capital. Among the best stocks to buy in the current environment are companies that have evolved from niche players into comprehensive platforms. Robinhood Markets exemplifies this transformation—trading near $75 per share after a significant pullback from its $150 October highs, the company now presents a compelling case for inclusion in diversified equity portfolios.

Once dismissed as merely an application for retail traders captivated by meme stocks, Robinhood has undergone a fundamental business evolution. The firm’s ascent over the past two years—posting a staggering 650% gain that eclipsed most artificial intelligence stocks, including Nvidia—underscores genuine operational progress beneath the surface volatility.

From Meme Stock App to Multifaceted Financial Platform

The narrative around Robinhood requires updating. The company’s 2021 initial public offering launched a now-distant era when the firm’s identity centered on commission-free stock trading. Today, Robinhood operates 11 distinct business divisions, each generating approximately $100 million or more in annualized revenue. This architectural diversity distinguishes Robinhood from its earlier incarnation and positions it alongside traditional players like Fidelity within the competitive landscape.

The company’s product ecosystem now encompasses retirement accounts, cryptocurrency trading, futures contracts, options trading, a professional-grade desktop platform designed for active traders, wealth management services, and prediction markets—the latter developed to compete with established platforms like Polymarket. This expansion reflects strategic ambition extending far beyond the mobile app through which most investors first encountered the brand.

Robinhood’s membership in the S&P 500, achieved in September, validated its evolution into a legitimate competitor serving institutional sophistication alongside retail demographics. The distinction matters significantly for investors evaluating among the best stocks to buy—Robinhood now represents diversified financial services exposure rather than a concentrated bet on retail trading enthusiasm.

Accelerating Business Metrics Suggest Continued Growth

The third quarter’s financial performance illustrated the tangible results of this strategic repositioning. Paid Gold Subscriber accounts expanded 77% year-over-year to reach 3.9 million, while total investment accounts increased by 2.8 million—an 11% expansion—to 27.9 million accounts. Average revenue per user climbed 82% to $191 per quarter, accompanied by a remarkable 100% year-over-year surge in total quarterly revenues.

Perhaps most significantly for equity investors, earnings per share soared 259% to $0.61 in the quarter, representing the fourth consecutive quarter in which Robinhood exceeded Zacks consensus estimates by an average 26%. This consistency matters when considering best stocks to buy for growth-oriented portfolios.

Wall Street’s forward estimates project adjusted earnings per share growth of 85% throughout 2025, followed by an additional 23% expansion in 2026, reaching $2.48 per share. This represents remarkable progression from the $0.60 per-share loss recorded in 2023 and the $1.09 earnings achieved in 2024. Notably, the 2026 earnings outlook has appreciated 63% since the previous summer, suggesting deepening analyst conviction.

Revenue projections support this earnings expansion narrative. Robinhood’s top line is forecast to expand 53% in 2025 and 22% in 2026, reaching $5.50 billion from $2.95 billion in 2024. The Most Accurate estimate category—Zacks’ highest-confidence analyst predictions—arrived above consensus expectations, indicating potential for additional positive surprises.

Technical Setup Presents Compelling Entry Points

For traders and longer-term investors evaluating entry timing, Robinhood’s technical picture warrants consideration. The stock is currently trading at 35.7 times forward earnings—representing a 60% discount to valuation levels observed at October highs. On a price-to-earnings-to-growth basis, Robinhood trades at 1.3, a 75% discount to its peak valuation and comparable to the broader technology sector median.

The stock is testing its post-2021 IPO breakout levels around current prices—psychological levels that have previously served as support during prior bull markets. Robinhood’s average Zacks price target of $143 implies 86% appreciation potential from current levels. Even more notably, the RSI (Relative Strength Index) has reached historically oversold territory, a technical signal that has historically preceded meaningful bounces in this equity.

Robinhood’s correction appears proportionate to its prior excesses. The company experienced genuine overheating that warranted fundamental recalibration. However, the 50% decline from peaks has now created technical asymmetry—downside risk appears increasingly limited while upside potential exceeds typical risk-reward ratios.

Catalyst Timeline and Investment Considerations

The immediate near-term catalyst centers on Robinhood’s Q4 earnings release scheduled for early February, with subsequent management guidance providing clarity on operational momentum heading into 2026. This earnings announcement represents an obvious checkpoint for investors considering entry points, as market reaction will either confirm or challenge the technical recovery narrative.

For investors identifying the best stocks to buy in current market conditions, Robinhood’s risk-reward configuration merits serious evaluation. The combination of fundamental business improvement, multiple expansion potential, technical oversold conditions, and approaching catalysts creates a window of opportunity that selective investors may wish to capture.