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Robinhood (HOO) shares closed up 7.9% on Friday, closing a week of wild trading, shares on the trading platform have gained 57% in the past five sessions after massive gains on Tuesday and Wednesday.
Yesterday, shares fell 27% after the announcement that some shareholders would cash up to 97.8 million shares. These sales are suspended until they receive approval from the Securities and Exchange Commission. This will likely happen after the company releases its second quarter results on August 18.
Robinhood appears to be the most recent meme action on Wall Street, highlighting the power of retail investors. It was one of the most mentioned actions on Reddit’s WallStreetBets Tuesday and Wednesday, according to SwaggyStocks. The stock’s commentary volume skyrocketed over a two-day period.
Shares were halted due to volatility in the opening minutes of Wednesday’s trading session. The stock has climbed over 80% at one point. The bullish move comes a day after the stock climbed 24%. The stock price surpassed its IPO price of $ 38 on Tuesday, in stark contrast to its public debut last week.
Fidelity’s real-time orders data on Wednesday showed Robinhood as the most traded stock, behind Advanced Micro Devices (AMD) and AMC (AMC), two stocks tracked by WSB members.
While short cutbacks have initially driven “meme” stocks up in the past, Robinhood’s move is not motivated by short coverage. “Until the availability of HOOD stock borrowing increases and the aggregate amount of short HOOD stocks becomes relevant – buying and selling by long shareholders is the reason for HOOD’s price movements,” S3 Partners’ Ihor Dusaniwsky told Yahoo Finance.
Leading investments in Robinhood could also help fuel the recent rally. Last week, Cathie Wood’s Ark Innovation ETF (ARKK) recovered about 4.9 million shares of Robinhood, according to Bloomberg data.
The recent moves are a stark contrast to the action’s public debut last Thursday. The stock fell as much as 12% below its IPO price on its first day of listing on the Nasdaq (^ IXIC). Shares closed 8% lower that day. Some have questioned whether its poor performance had something to do with Robinhood’s hybrid auction-style debut, a lack of a lock-in period for 15% of shares held by employees and the like, or concerns about headwinds. of the regulations.
Robinhood has been a key player in the retail boom involving GameStop (GME) and other stocks for the past year and a half. In an unusual move, the company allocated around 35% of its shares to retail investors for its IPO.
Ines is a markets reporter covering stocks on the New York Stock Exchange floor. Follow her on Twitter at @ines_ferre
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