Shares of Robinhood Markets Inc. rocketed Friday, to extend their bounce off a recent record low, after the trading app disclosed a large active investment by Sam Bankman-Fried, who founded and runs the cryptocurrency exchange FTX Trading.
The stock HOOD, +23.54% shot up 23.3% in afternoon trading. That follows a 5% gain on Thursday, which followed Wednesday’s lowest-ever close of $8.15.
The filing showed that Bankman-Fried spent $648.29 million to buy that stake, which implies a price of $11.52 for each share. The stock hasn’t traded at or above that price in intraday trading since April 20.
And while the filing was on form 13D, which is often used by activist investors to disclose beneficial ownership of at least 5%, Bankman-Fried said he did “not currently have any intention of taking any action toward changing or influencing the control” of the company.
He said the purpose of the purchase was that he believed “the shares represent an attractive investment.”
Robinhood responded via a series of tweets that it was “doubling down” on creating a multigenerational company, and also believed its stock was an attractive investment.
That said, the stock had suffered a steep slide since the early days of going public, following a string of quarterly reports of wider-than-expected losses and revenue misses, as fewer users were trading stock, cryptocurrencies and options. Despite Friday’s rally, the stock was still 72.2% below its $38 IPO price, and 85% below the Aug. 4, 2021, record close of $70.39.