Robinhood stock not included in the S&P 500 index. Why are investors hoping for Trump?

US-based Robinhood Markets, operator of a popular stock market trading platform, has once again failed to make it into the S&P 500 index. But Trump's "big, beautiful" law may prove more important for the company's stock.

At the short pre-holiday session on July 3, Robinhood securities fell by 3.7%. Before that, they grew three days in a row, adding 18% and updating the historical maximum. Quotes collapsed after, contrary to Wall Street expectations, S&P included in its benchmark stock index not Robinhood, but the company Datadog, which will replace Juniper Networks after its purchase of Hewlett Packard Enterprise. In June, when Robinhood was also not included in the S&P 500 Index, its shares fell 2%. They are now trading nearly 29% above that level.

Far more important than inclusion in the S&P 500 for Robinhood stock, however, may be Donald Trump's "big, beautiful" tax bill, already approved by both houses of the U.S. Congress, accounts Marketwatch. It provides for the creation of tax-deferred investment accounts for newborn Americans. The so-called Trump accounts would be funded with a one-time $1,000 contribution from the government and invested in funds that track a stock index. Parents will be able to contribute up to $5 thousand in additional funds each year.

For Robinhood, this opens up access to a whole new client audience. The trading platform now serves only adults, but is preparing a program that will allow it to "reach all newborns in the U.S. - about 3.7 million a year - with a brokerage account with $1,000 passively invested in the S&P 500 Index," Robinhood founder Vlad Tenev told CNBC. There is already a working prototype app for the program, he said. Robinhood also plans to get involved in financial education for children and talk about the U.S. capitalist system.

This week has been a busy one for Robinhood. Shares of the trading platform soared in value after the launch of cryptocurrency tokens of U.S. stocks for clients from the European Union. On July 2, Robinhood's quotes in New York hit an all-time high after U.S. Securities and Exchange Commission (SEC) Chairman Paul Atkins called the stock tokenization project an "innovation" in an interview with CNBC.

From a tech-analysis perspective, Robinhood shares now look like a Strong Buy: the stock is in an uptrend, its growth may continue in the near term, and there is no market overheating yet, considers Investing.com.

On July 1, Deutsche Bank raised its target on Robinhood shares from $85 to $96, while Mizuho Securities raised its from $80 to $99 with a Buy recommendation (Buy at Deutsche Bank, Outperform at Mizuho). The consensus rating on Robinhood's stock in recent months has been at an "above market" level (Overweight, matching the buy recommendation). At the same time, the average target price of $78.81 per share calculated by FactSet service implies a 16.5% decline in the trading platform's stock price over the next year from the current level;

This article was AI-translated and verified by a human editor