We recently compiled a list of the 12 Best Booming Stocks to Invest in Now. In this article, we are going to take a look at where Robinhood Markets, Inc. (NASDAQ:HOOD) stands against other best booming stocks to invest in now.
The U.S. stock market closed on a downbeat on Friday, January 31, as investors grappled with the announcement that President Donald Trump’s new tariffs on major trading partners would take effect the following day. The Dow Jones Industrial Average tumbled 0.75%, to close at 44,544.66 and the S&P 500 shed 0.50% to close at 6,040.53, while the Nasdaq Composite slipped 0.28% to 19,627.44. However, the day marked the end of a tumultuous January for traders with the three major averages still managing to post monthly gains. The S&P 500 rose 2.7%, the Nasdaq advanced 1.6%, and the Dow surged 4.7%.
Economic data released on Friday also influenced market sentiment. The December data for the personal consumption expenditures (PCE) price index, which is the preferred inflation gauge of the Federal Reserve, showed an increase of 0.3% from November and a 2.6% annual rate. While this yearly advance was in line with economists’ expectations, it marked an acceleration from the prior month’s annual rate of 2.4% and raised concerns that inflation remains sticky.
Tom Hainlin, a senior investment strategist at U.S. Bank Asset Management Group, noted that the market’s initial reaction to the tariff news was to sell, much like the reaction to the DeepSeek AI developments earlier in the week. Trump will be imposing a 25% tariff on Canada and Mexico, alongside a 10% duty on China. However, Hainlin explained that there are no details about tariffs, whether they are temporary or permanent, or what the potential responses from Canada, Mexico, or China might be.
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In an interview with CNBC on January 22, Jamie Dimon, Chairman and CEO at JPMorgan Chase, discussed a range of economic and political issues, including market conditions, the impact of a strong dollar, and the broader economic policies of the United States. Dimon began by addressing that the current state of the U.S. stock market is elevated and stocks trading at a historic price-to-earnings ratio. Dimon believes that the stock prices must be justified by strong growth and there is a need for good outcomes to sustain these levels.
Dimon suggested that the strength of the dollar is an outcome of broader economic factors and that a strong dollar can have its benefits but it can also have negative effects, especially for international companies dealing with tariffs and trade tensions. However, Dimon downplayed the significance of the strong dollar, stating that it is less important than many people think and that the most crucial factor remains economic growth.
Dimon further discussed the challenges of implementing growth strategies, emphasizing that while many recognize the need for change, the real challenge lies in execution. He also addressed the geopolitical issues with Ukraine, Iran, Russia, North Korea, and China, expressing that these issues can affect the world in the long term. He noted that while tariffs are a significant topic of discussion, they are just a tool in a broader economics and national security strategy. Overall, Dimon is cautiously optimistic about the economy and highlighted concerns about government spending, potential inflation, and the global economic landscape.
While the market appears overvalued and faces significant headwinds, some stocks are performing exceptionally well and hold significant potential.
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Our Methodology
To compile our list of the 12 best booming stocks to invest in now, we used Finviz and Yahoo stock screeners to identify the 30 largest companies whose stock prices have increased by at least 35% year-to-date as of January 30. We then used Insider Monkey’s Hedge Fund database to rank 12 stocks according to the largest number of hedge fund holders, as of Q3 2024. The list is sorted in ascending order of hedge fund sentiment.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Robinhood Markets, Inc. (NASDAQ:HOOD)
Number of Hedge Fund Holdings: 36
Year-to-Date Performance as of January 30: 42.24%
Robinhood Markets, Inc. (NASDAQ:HOOD) is a leading financial services company that has revolutionized the way individuals invest in the stock market and engage with digital assets. The company offers a wide range of financial products, including stocks, options, cryptocurrencies, and ETFs, making it a one-stop solution for retail investors.
One of the primary drivers of Robinhood Markets, Inc.’s (NASDAQ:HOOD) stock price increase in 2025 has been the anticipation of a more favorable regulatory environment under the Trump administration. Wall Street analysts such as Gautam Chhugani from Bernstein and Michael Cyprys from Morgan Stanley have highlighted the potential for clearer rules on digital asset classification, which could allow Robinhood Markets, Inc. (NASDAQ:HOOD) to expand its crypto offerings. This includes the ability to list more tokens and capture a larger share of the spot crypto trading market. The expectation of reduced regulatory constraints is particularly significant for Robinhood Markets, Inc. (NASDAQ:HOOD), as it has been constrained in its crypto business due to the current regulatory environment. The prospect of deregulation could unlock significant growth opportunities and increase investor confidence in the company’s long-term prospects.
Robinhood Markets, Inc. (NASDAQ:HOOD) is poised to open new crypto-focused revenue streams over the next 12 months, which could significantly enhance its business model. The company is exploring opportunities in staking, stablecoin lending, and other services typically offered by crypto exchanges. These new revenue streams could diversify Robinhood Markets, Inc.’s (NASDAQ:HOOD) income sources and reduce its reliance on traditional trading fees.
Overall HOOD ranks 4th on our list of the best booming stocks to invest in now. While we acknowledge the potential of HOOD as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than HOOD but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.