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What's in the Offing for Robinhood (HOOD) in Q4 Earnings?

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Robinhood Markets, Inc. (HOOD - Free Report) is slated to report fourth-quarter and full-year 2021 results on Jan 27, after market close.

In the last reported quarter, Robinhood incurred a wider-than-expected loss of $2.06 per share. Solid growth in revenues, driven by a rise in transaction-based revenues, net interest revenues and other revenues were more than offset by a substantial rise in total operating expenses.

The Zacks Consensus Estimate for the fourth quarter stands at a loss of 34 cents per share. The estimates have been unchanged over the past seven days.

The consensus estimate for total sales is pegged at $393.2 million, which indicates a 23.6% rise from the year-ago quarter’s reported figure.

Management Expectations for Q4

The company expects seasonal headwinds and lower trading activity across the industry to result in total revenues to be approximately $325 million, down 11% sequentially. Also, driven by these factors, new funded accounts are anticipated to be 660,000, almost in line with the prior quarter.

As the company invests in key areas to enhance platform capabilities, drive product innovation, improve customer support and build upon regulatory and compliance functions, overall costs are anticipated to remain elevated.

Earnings Whispers

According to our quantitative model, the chances of Robinhood beating the Zacks Consensus Estimate this time are low. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or better, which is required to be confident of an earnings beat.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Robinhood has an Earnings ESP of -25.24%.

Zacks Rank: The company currently carries a Zacks Rank #3.

Stocks to Consider

A few finance stocks, which you may want to consider as these have the right combination of elements to post an earnings beat in their upcoming releases per our model, are The Blackstone Group (BX - Free Report) , Franklin Resources (BEN - Free Report) and Ares Capital Corporation (ARCC - Free Report) .

Blackstone is slated to report quarterly earnings on Jan 27. BX, which carries a Zacks Rank of 3 at present, has an Earnings ESP of +3.76%.

Franklin is slated to report quarterly earnings on Feb 1. BEN, which carries a Zacks Rank #3 at present, has an Earnings ESP of +0.11%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Ares Capital is slated to report quarterly results on Feb 9. ARCC currently has an Earnings ESP of +11.11% and a Zacks Rank #2 (Buy).

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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