Robinhood single-stock perps could be a 'strong positive' for HOOD shares, Mizuho says

Could perpetual futures drive meaningful upside for Robinhood (HOOD) shareholders? A new Mizuho survey suggests strong potential demand for single-stock contracts.

A survey of more than 600 active Robinhood users found that 94% would be likely or very likely to trade single-stock perpetual futures if they become available. Cannibalization of existing equity trading appears limited, with 84% of respondents saying they would use mostly or exclusively new money to trade the contracts, according to the analysts.

"We view this as a potential strong positive," Dan Dolev, Mizuho managing director, wrote in a Wednesday note.

Robinhood said on Sept. 29 that it plans to launch perpetual futures trading for U.S. users in the coming months, alongside 24/7 trading for select U.S. equities.

However, Johann Kerbrat, Robinhood's senior vice president and general manager of crypto and international, recently told The Block that the company had no single-stock perpetual plans to announce. He also said Robinhood was still working through the SEC's latest innovation exemption on tokenized stocks.

"While timing is uncertain around single-stock perps, we believe it is plausible to assume this product could come over the medium-term," Dolev said.

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Mizuho reiterated its Outperform rating and $140 price target on HOOD, citing the potential for single-stock perps to emerge over the medium term. Coinbase's September filing to list perpetual futures tied to large-cap U.S. stocks provides further evidence of industry interest in the product.