Robinhood (NASDAQ: HOOD) stock dropped 12.5% post Q4 earnings last night. It beat earnings estimates but missed on sales, clocking just under $1.3 billion. Sales climbed 28% in Q4, with 39% growth in interest income. However, “transaction-based revenues” (trading) only rose 15%. Earnings fell 35% despite beating estimates.

For all of 2025, Robinhood saw 52% sales growth to $4.5 billion and earnings up 31% at $2.05 per share. Investors are disappointed with Q4 results. Priced at $77 billion, the stock costs just under 37 times trailing earnings. Free cash flow at $1.6 billion is better than 2024, but backs up only 84% of profits.

Despite growth, Robinhood looks like a sell due to concerns about shrinking earnings. Consideration of price-to-free cash flow ratio makes the stock seem more expensive. The Motley Fool Stock Advisor team has identified the 10 best stocks to buy now, and Robinhood Markets did not make the cut.

Read more at Yahoo Finance: Why Robinhood Stock Crashed After Earnings