What's up Apes? Welcome back to the five minute peel. Today we are going to be breaking down Robin Hood. Now, anybody that's been reading the peel for a while knows that I hate Robin Hood almost as much as I hate myself. So we're excited to get into things here today. We did get a comment requesting that we cover Robin Hood. So make sure if there are any companies that you want to hear us yap about, you drop it in the comments down below, and we'll be sure to get to it as quickly as we possibly can. You guys know how this goes already.

Basically what I'm going to do here is pull up and share my screen. Make sure to stay tuned till the end, however, because we are giving in addition to a rating an official price target. So make sure to check that out and stick with us for the full way to see exactly where our targets come from. Now, of course, the first thing we want to talk about is the company's insane return over the past year, nearly 90% in just the past year alone.

The big reason for that is because the company is finally back to growth in revenue.

They did decline in 2022 from 2021, but back on top in 2023.

So the big reason for that was not because of transaction-based revenue growth, which is the company's made business model, but entirely because of net interest revenues.

And for the first time, net interest revenues are now the largest part of the revenue mix.

Now, that's risky because this has absolutely nothing to do with the companies fundamentally.

It's entirely because of rate hikes from Mr. Jerome Powell, meaning that they're able to increase the spread on what they're making on the interest side versus what they're actually paying up to their users on net deposits. We also saw a return to growth in other revenues. Other revenues basically encompasses Robin Hood Gold and some other more minor things. So seeing that come back to growth was an actual positive side because Robin Hood Gold in the subscription product

that comes with that is basically the company's entire growth plan going forward.

So we'll talk about that in just a quick minute, but before we do, we want to break down

this transaction based revenue growth a little bit more because it is absolutely disgusting.

The only asset class that's actually growing is option.

So it's pure degenerate trading right now, stocks and crypto trading.

The fact that crypto is considered less degenerate than something else should tell you alone,

stocks and crypto revenue has been down over the past two years. Now, the other big thing that

we're kind of very concerned about here is that they are destroying their tech and development

expense. This is basically R&D, but for Robin Hood, and we can see that

it has been reduced by about a third over the past two years, and its percentage as a portion

of total revenue is on the decline as well. You would think that a company that relies so much

on having a superior product would want to invest in this to kind of keep that mode, but they

are absolutely not doing that whatsoever. The only thing that they are doing is getting closer to profitability by destroying a key expense. We would much rather see them reduce G&A in marketing, but instead what they're doing is taking a lot of the T&D expense and pouring that into marketing, because that's really the only way that they actually attract customers. You probably see it in your YouTube advertisements as well. Maybe there's one even on this video.

Let's go ahead and break down Robin Hood's business a little bit more so. So the company is a broker. Brokerage is a very tough business taken from me. I actually used to work at a big wirehouse brokerage firm. And so one of the biggest differences that you'll notice in looking at Robin Hood's 10K or 10Q versus other brokerage firms as the way that they

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