Robinhood Unveils Big Stock Buyback Program: What To Know
Stock trading app Robinhood said its board authorized a $1 billion share repurchase program. Here's what that means.


Late Tuesday, Robinhood Markets (HOOD) said its board of directors approved a $1 billion share repurchase program, which has its shares trading cautiously higher in Wednesday's trading session.
Robinhood said it expects the share repurchases to take place over a two- to three-year period beginning in the third quarter of 2024. This will depend "on general business and market conditions, and alternative investment opportunities," the company said in a statement, adding that management "plans to vary the pace of capital deployment depending on share price."
"As our business and cash flow have continued to grow, we're excited to announce a $1 billion share repurchase program to return value to shareholders," said Jason Warnick, chief financial officer at Robinhood Markets.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The news comes just three weeks after Robinhood reported record first-quarter earnings results. Specifically, the company said revenue increased 40% year-over-year to $618 million and its earnings per share swung to 18 cents from a loss of 57 cents in the year-ago period.
The results blew past analysts' expectations and has led to a rally of more than 15% in the weeks since the release.
How will Robinhood's stock buyback impact investors?
Stock buybacks are another way for corporations to boost value for shareholders. As Kiplinger contributor Mark Hake explains in his piece on "What Is a Stock Buyback," a company "that buys back its shares will produce a higher stock price because as its shares count falls, it forces the price higher."
Hake goes on to explain "that effect produces more value for shareholders, as they pay no taxes on this unrealized gain (until they sell shares)."
Where does Robinhood stand with analysts?
Most analysts are on the sidelines when it comes to the financial services stock. According to S&P Global Market Intelligence, the consensus analyst target price for HOOD stock is $20.63, which is right around where the stock trades today. Meanwhile, the consensus recommendation on the online broker and trading platform is Hold.
Still, some analysts are starting to turn more bullish. BofA Securities, for instance, recently double-upgraded HOOD stock to Buy from Underperform (Sell).
BofA said rebounding retail engagement has benefitted multiple metrics for Robinhood, including account growth, margin loans and payment for order flow. The research firm adds that HOOD's operating leverage and free cash flow conversion are underappreciated by the market.
The group at BofA has a $24 price target on Robinhood, which represents implied upside of over 15% to current levels.
Related Content
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.
-
Rideshare Drivers Could Lose Thousands By Overlooking This
Being a rideshare driver can be a great way to meet people and make money. But overlooking this one thing could cost you thousands.
-
Ask the Editor — Tax Questions on What Congress Will Do Next
Ask the Editor In this week's Ask the Editor Q&A, we answer questions from readers on what Congress will do next with taxes.
-
Bonds Pay in Good and Bad Times
Bonds can act as a financial safety net through good times and bad. But different bonds carry different returns and risks, so do your homework before investing.
-
When You Need Capital Quickly, Think 'Ready, Set, Fund': A Financial Adviser's Strategy
Investors must be able to free up cash to meet short-term needs from time to time. This strategy will help you access capital without derailing your long-term goals.
-
I'm an Estate Planner: Moving Family Assets to a Safe Haven Abroad Could Be a Huge Headache for Your Heirs
In troubled times like these, wealthy clients may seek financial refuge outside of the U.S. But that could cause more tax and estate problems than it solves.
-
S&P 500 Extends Losing Streak Ahead of Powell Speech: Stock Market Today
Stocks continued to struggle ahead of Fed Chair Powell's Friday morning speech at Jackson Hole.
-
A Timeline of Warren Buffett's Life and Berkshire Hathaway
Buffett was the face of Berkshire Hathaway for 60 years. Here's a timeline of how he built the sprawling holding company and its outperforming equity portfolio.
-
Powell Signals Rate Cuts in His Jackson Hole Speech. Here's What Wall Street is Saying
In his speech at the Jackson Hole symposium Friday, Fed Chair Jerome Powell said current conditions "may warrant" rate cuts.
-
Fall Is Tax Time? Yes! Act Now to Make Needed Adjustments
Review your withholdings, contribute to tax-saving HSA and FSA accounts, manage a bonus' impact and adjust for major life events such as weddings and job changes.
-
Board Service in Retirement: The Best Time to Join a Board Is Before You Retire
Many senior executives wait until retirement to take a seat on a corporate board. But making this career move early is a win-win for you and your current organization.