Trading app Robinhood (HOOD) reported earnings after the close on Wednesday and the stock tumbled more than 10% Friday.
On July 29, Whitney Tilson wrote:
It's a sad day in the investing world as stock trading app Robinhood goes public. As I've written many times before, I think this company is an absolute disgrace and agree wholeheartedly with Charlie Munger, who said it's "Beneath contempt."
Robinhood belongs in the hall of shame alongside e-cigarette company Juul and oxycontin maker Purdue Pharma for pushing products that hurt people.
Robinhood's entire business model depends on further turning our markets into, as Munger put it, "Gambling parlors" – encouraging people to speculate madly by day-trading options and worthless garbage that I've nicknamed Doggycoin (DOGE-USD) and GameStink (GME).
Robinhood's earnings report only reinforced my view. To understand what a "gambling parlor" the app is, look no further than this chart:
Ripping your customers' faces off can, sadly, be a very good business – just look at most multilevel marketers like Herbalife Nutrition (NYSE:HLF) and predatory lenders like World Acceptance (NASDAQ:WRLD). But nevertheless, I'd avoid Robinhood's stock...
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