Piper Sandler expects Robinhood to start football season with a win

Robinhood could see a sizable boost to its prediction market revenue as football season begins next week, according to a Wednesday note from Piper Sandler.

Earlier this summer, the World Cup paved the way for explosive volume growth in prediction markets, and it suggests strong numbers could show up during football season, according to analyst Patrick Moley.

“Given Kalshi & HOOD’s US-centric user base, and the large gap in popularity between Soccer and Football in the US, we view the explosive World Cup volumes as a leading indicator of what’s to come — the NFL/[NCAA Football] season should be a significant catalyst for HOOD’s 3Q26 and 4Q26 prediction market revenue,” he wrote.

Rothera, which launched in June, is a prediction markets joint venture between Robinhood and Susquehanna. It’s a derivatives exchange and clearinghouse that’s regulated by the Commodity Futures Trading Commission.

The rosy outlook comes after Robinhood management confirmed Rothera has obtained approval from the CFTC to provide football contracts covering wins and spreads, Piper Sandler said.

To that end, Moley lifted his forecast for Robinhood’s 2026 and 2027 earnings per share estimates by 5% and 7%, respectively, and he lifted his price target to $145 from $135, suggesting about 35% upside from Wednesday’s close. The analyst also reiterated his overweight rating on the stock.

While Robinhood displays Kalshi’s markets to its users, Moley estimates roughly 23% of prediction market volume has shifted to Rothera from Kalshi since June. 

“Robinhood’s shift to Rothera has accelerated the decline in its share of Kalshi’s volumes,” Moley said in the Wednesday note. “Last year during football season, HOOD users made up between 22% and 30% of all volume traded on Kalshi, a share that has decreased to the mid-single digits behind Kalshi’s quest to acquire more of its own users,” the analyst wrote. 

Between June and August, average monthly prediction market volumes at Robinhood grew 88%, compared to the January to May period, largely because of strong World Cup engagement, Moley added.

To come up with projections for Robinhood’s prediction markets revenue in the second half of the year, Piper Sandler used Kalshi as a proxy.

The firm’s analysts predict that from September through December, Robinhood users will trade roughly 29.7 billion event contracts and generate around $320 million in revenue, or $960 million annualized.