3 Stats That Will Keep Investors Away From Robinhood Stock

HOOD stock - 3 Stats That Will Keep Investors Away From Robinhood Stock

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The tech selloff shows no signs of simmering. In the last six months, tech stocks have been experiencing an implosion of market value as the markets lose interest in high-growth, risky performers. Instead, the focus is shifting to retirement and dividend stocks. However, several companies are gaining attention due to discounted valuations. Unfortunately, I am here to tell you to avoid Robinhood (NASDAQ:HOOD) stock at this time.

One can pinpoint several reasons for this. However, to be razor-sharp, the major reason not to invest in this company is that the app lacks engagement:

HOOD Stock Is a Sell

Warren Buffett, the world’s sixth-richest person and chief executive officer of Berkshire Hathaway (NYSE:BRK-A), sees Robinhood as a problem because it’s contributing to speculative investing. The words were echoed by Charlie Munger, the vice-chairman of Berkshire Hathaway. Munger expressed similar sentiments when he issued nearly identical remarks at the Berkshire Hathaway annual meeting.

But Robinhood has had an incredible impact on the markets. It had given retail investors an opportunity they never had before and knew their priorities. However, there are considerable issues the company needs to tackle as users retreat to safer pastures. The company’s reliance on the crypto world also causes concern. In addition, the new earnings report from Robinhood had some investors raising concerns about competitors catching up with them.

Due to these factors, investing in HOOD stock is not the safest option.

On the publication date, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience in analyzing the stock market and was a former data journalist at S&P Global Market Intelligence. His passion is to help the average investor make more informed decisions regarding their portfolio.


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