(C) Reuters. 3 Robinhood Stocks Wall Street Believes are Overvalued
The heightened popularity of stock trading amid the COVID-19 pandemic made the Robinhood trading app a big hit among millennials, owing to its differentiated features and benefits. In fact, popular stocks on the Robinhood platform are followed by many analysts. However, given current market volatility, Wall Street believes Robinhood favorites Palantir (PLTR), Carnival (NYSE:CUK) (CCL), and BlackBerry (NYSE:BB), are substantially overvalued, and might witness a price retreat soon. Let’s take a closer look at these names.A zero-commission policy, free stock disclosures, and related services provided by the Robinhood online investing app made it a big hit among millennials amid the COVID-19 pandemic. Robinhood generated $682 million in payment for order flow in 2020, a 514% increase year-on-year.
While U.S.’ accelerated recovery from the COVID-19 pandemic is likely to continue over the coming months, rising geopolitical tensions amid surging inflation and increasing Treasury yields have been causing volatility in the stock markets. Consequently, many stocks that are popular with Robinhood investors that gained primarily based on market hype are currently suffering selloffs. Their lofty valuations and poor growth prospects are the primary reasons behind investors’ rotation away from them.
Given their weak fundamentals and growth prospects, popular Robinhood stocks Palantir Technologies Inc. (PLTR), Carnival Corporation (CCL), and BlackBerry Limited (BB) look highly overvalued at the current price levels, according to Wall Street analysts. So, we think they are best avoided now.
3 Robinhood Stocks Wall Street Believes are Overvalued
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