1 Magnificent Growth Stock Down 33% to Buy and Hold Forever

If you invested in Robinhood (NASDAQ: HOOD), the online brokerage stock, since it went public in the summer of 2021, you're probably pretty happy with the results so far.

The stock began trading on July 28, 2021 at around $38 per share, so if you bought, say, 10 shares for $380, you would have doubled your money, as the stock is now trading at around $76 per share.

But in reality, all of that gain, and then some, came in 2025, a breakout year for Robinhood stock. It began 2025 trading at around $37 per share, about the same as it was when it IPO'ed. But it ended the year at $113 per share, up some 205%. At its all-time high in early October, Robinhood soared to $152 per share. At that point it had gained a ridiculous 310% since the start of 2025.

Image source: Getty Images.

However, it has dropped 50% from that Oct. 9 high and is down 33% year to date in 2026.

If you were along for the ride, stay on board, and if you are kicking the tires on Robinhood, you may want to consider driving it off the lot. That's because Robinhood is a stock to buy and hold for the long haul, and this latest nosedive represents an excellent buying opportunity.

Why Robinhood is a steal

Robinhood stock is down about 33% year to date, mostly as a backlash to its high valuation due to its meteoric rise. Many investors were probably taking profits after the 200%-plus run in 2025.

But the reality is, the growth engine that allowed Robinhood to break out in 2025 remains. In the fourth quarter, adjusted earnings beat estimates and rose 24% year over year, while revenue climbed 27% to $1.28 billion. Revenue missed estimates based on a 52% drop in crypto trading volumes. That continued in January as crypto trading fell 57%.

But that is offset by a 68% increase in equity trading volumes, a 38% rise in options trading, and a 102% jump in assets in its retirement accounts. Also, Robinhood saw a record 8.5 billion in event contracts traded, or prediction markets, and in January it set a monthly record of 3.4 billion traded.

Robinhood is going to have quarters where crypto is a drag and quarters where crypto is a boon -- that is the nature of the beast. But it has been able to smooth that out with consistent growth in customers and stock trading. It should also get a lift from its entry into prediction markets, the fastest-growing new product in its history, along with other products, like its financial services offerings and retirement accounts.

Overall, Robinhood has some 27 million accounts on its platform, up 7% year over year.

Robinhood is poised for continued growth as it seeks to become the "financial superapp" as CEO Vlad Tenev said in the earnings report. Some 82% of analysts rate it as a buy, with a median price target of $125.50, suggesting a 66% return.

Its valuation is still a bit high with a forward P/E of 31, but it is down sharply from 69 back in October. This reset could potentially drag on a bit longer if crypto continues to tank, but long-term, this is a stock to buy and hold for a long time.

Dave Kovaleski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.