Robinhood has taken the investing universe by storm, bringing together young investors with the tools they need to start putting money to work on the stock market. Many young people are starting to get into investing in stocks for the first time, and the commission-free in-app brokerage has been involved in opening the door for those who were previously reluctant to invest.
Robinhood’s investors, however, often fail to abide by Wall Street rules.They are predisposed to speculative stocks with great potential for profit. But it is too risky. Many people trade frequently and sometimes buy shares of doomed companies in the hope of quick short-term profits.
As a result, many of the favorite stocks in Robinhood were fully exposed by Wall Street stock analysts, notably the four stocks on the top list, the Robinhood Top 100, stood out with a good rating of less than 10%. From analysts Who’s Right: Investor Robinhood or Wall Street? Read on for a closer look.
Carnival (NYSE: CCL) It has garnered a lot of attention over the past year as cruise giants have been the hardest hit by the COVID-19 outbreak. Shares have fallen 57% over the past year, although they added. It was up 140% from its worst level in late March and early April. Of the 18 analyst ratings who followed Robinhood, only one rated Carnival purchases versus a four-time sales ranking and a 13-place ranking.
It’s easy to understand why Wall Street isn’t thrilled with Carnival.The company has been unable to sail for almost a year, and with the latest wave of COVID-19 cases, even the vaccine launch hasn’t allowed Carnival to set clear expectations. When to go Out into the open sea again Meanwhile, the company expects to lose another $ 2 billion in the fourth quarter and continues to burn cash at an alarming rate.
The promising shareholders’ hope is that at some point the epidemic will come under control, and when it does, cruise ship fans will be excited to take a cruise where they have to take a break. Go a long time in the end But at the same time, Carnival continues to raise money and weaken the interests of its current shareholders. That means the eventual recovery may not be as good for the stock as Robinhood investors would like, Carnival is likely to survive. But it may not appear in a much higher stock price.
2. Aurora Cannabis and 3. HEXO
Marijuana stocks make a comeback, and the hopes of legalizing it in the United States have a lot of investors betting on marijuana, however Wall Street is not convinced. Aurora marijuana (NYSE: ACB) It was rated a one-time buy from 17 analysts, with four sales and 12 holdings. HEXO (NYSE: HEXO) Not much of a difference with a single purchase, 12 hold, and single sale.
Both Aurora and HEXO had a bad time in 2020, down 68% and 42%, respectively, but they were back to the start of the new year.HEXO almost doubled, while Aurora was up 40%.
Bullish investors hope the new administration in Washington will take steps to decriminalize marijuana at the federal level. This won’t automatically open the market in all states, but it will make it easier for companies like HEXO and Aurora to do business in the United States, especially in jurisdictions that have already certified medical and / or recreational marijuana.
The skeptics point to the history of Aurora’s diluted IPO, which appears to have occurred as the share price began to move higher. Molson Coors (NYSE: TAP) The Colorado-based CBD beverage product launch in Colorado could be a good starting point to consider further growth opportunities. However, both companies face competitive challenges and need to overcome the operational inefficiency that has held them back.
last Slack technology (NYSE: works) Here’s a summary of Wall Street’s least favorite Robinhood stocks. The stock was rated a one-time buy by 22 analysts, while the other 21 were neutral, with the rating suspended.
In Slack’s case, the word “hate” was too harsh to describe Wall Street’s mood. That’s because the rating suspension was likely due to Slack’s pending acquisition by: salesforce.com (NYSE: CRM)Under the terms of the deal, Salesforce will pay $ 26.79 per share in cash and Slack investors will receive 0.0776 Salesforce shares, currently valued at about $ 17 at the latest price.
As a result, owning a Slack is like investing 40% of your money in Salesforce and keeping the other 60% in cash.Salesforce is likely to be stable for the future, with 35 of 43 analysts rating a buy, according to Robinhood. A solid vote of confidence for the tech giant and a stake will give Robinhood investors a exposure to Salesforce without paying any more taxes if the deal goes through.
Who’s right: Wall Street or Robinhood investors?
Of these stocks, Slack appears to be the safest bet to generate long-term profits, assuming shareholders will enter Salesforce shares once the merger is complete.HEXO, Aurora and Carnival still face a lack of. Definitely important
That doesn’t mean the right investors Wall Street and Robinhood are wrong, but it means that if you’re considering buying those stocks, you should know what you’re doing before investing.