Updating my investment portfolio for 2026, I noticed a bold move by Tom Lee of Fundstrat, who recommends investors stay away from Robinhood shares, despite the company's impressive quarterly results. Instead, his top favorites became banking giant JPMorgan and technology company Arista Networks.
Lee's decision is sparking lively debate among market participants. The sharpest criticism came from Kevin Simpson, founder and chief investment officer of Capital Wealth Planning. He categorically disagrees with this assessment, pointing to Robinhood's outstanding second-quarter performance. The company's revenue grew 32% year-over-year, reaching a record $1.31 billion. Diluted earnings per share jumped 48% to $0.62, and net client inflows hit an all-time high of $22 billion, up 28% from a year earlier.
Business transformation and crypto ambitions
Simpson rightly notes that Robinhood is no longer the pandemic-era company we once knew. Strategic moves, such as acquiring a licensed investment advisor and launching its own asset custody service, point to a deep business transformation. Brenda Vingiello of Sand Hill Global Advisors, who sold her Robinhood shares in June, also does not share Lee's pessimism, emphasizing the continued close correlation between the company's stock performance and sentiment in the digital asset market.
Robinhood's cryptocurrency segment is indeed undergoing structural changes. Although revenue from crypto transactions fell 38% in the second quarter to $100 million, the company is actively building the infrastructure of the future. The launch of Robinhood Chain, its own layer-2 blockchain based on Arbitrum, is an ambitious bet on stock tokenization, decentralized lending, and 24/7 trading. Already, the total value locked (TVL) in this network has exceeded $550 million, with about 25% coming from tokenized real-world assets. More than half of the TVL is concentrated in the USDG stablecoin, pegged to the U.S. dollar.
Robinhood shares are currently trading around $96, and the company's market capitalization has reached $86 billion. The success of Lee's other recommendations — Arista Networks, riding the wave of AI infrastructure demand, and JPMorgan, benefiting from the IPO market recovery — may prove less dependent on cryptocurrency market conditions than Robinhood's fate.
My view: Tom Lee's recommendation looks conservative and cautious, but it underestimates Robinhood's potential as a key bridge between traditional finance and the crypto economy. It remains unclear what will become the main growth driver for the network — institutional tokenization or retail crypto speculation — but ignoring this transformation, relying only on past merits, is a strategic mistake. Investors should closely monitor the development of Robinhood Chain and its ability to monetize new products, rather than writing the company off.