"Mizuho views the SEC's pattern day trader rule elimination as "structurally positive" for Robinhood. The old rule required traders to maintain at least $25,000 in their accounts to execute more than three day trades in a rolling five-day window."
"Dolev's team ran a proprietary survey of 160 traders with less than $25,000 in their accounts. The findings were telling: over 80% reported being constrained by the old rule, suggesting meaningful pent-up demand."
"Mizuho estimates that trading activity for this cohort could increase by 3% as those restrictions lift. The firm also notes that Robinhood is "over-indexed to smaller balances," with an estimated 25% of its funded accounts falling under the old $25,000 threshold."
"Robinhood has spent the last two years diversifying well beyond its roots. Full-year 2025 revenue hit a record $4.473 billion, and Robinhood Gold subscribers grew to 4.2 million, up 58% year-over-year."
Mizuho analyst Dan Dolev increased Robinhood's price target from $105 to $115, maintaining an Outperform rating. The SEC's removal of the $25,000 minimum for day traders is seen as beneficial for Robinhood, which caters to small-balance traders. A survey indicated over 80% of traders under this threshold felt constrained by the old rule, suggesting increased trading activity. Robinhood's user base is heavily skewed towards smaller accounts, which could positively impact future sales estimates.
Read at 24/7 Wall St.
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