Investing.com -- Barclays upgraded Robinhood Markets Inc (NASDAQ:HOOD) and Charles Schwab Corp (NYSE:SCHW) to "overweight," citing improved market conditions and growth opportunities for brokers and alternative asset managers for 2025.
While Robinhood is expected to benefit from its growth strategy on the back of an evolving crypto landscape, Schwab is expected to see earnings growth as cash sorting issues and attrition from past mergers subside. Both companies are positioned to capitalize on a constructive macro backdrop, Barclays (LON:BARC) noted.
For alternative asset managers, Barclays expects a resurgence in transaction activity, driven by pent-up demand and a favorable sentiment shift. Key themes such as private credit, data centers, and infrastructure are likely to remain strong.
Among traditional asset managers, BlackRock (NYSE:BLK) continues to be Barclays’ preferred pick.
In contrast, the outlook for exchanges is less favorable. Barclays downgraded Cboe Global Markets (NYSE:CBOE) to "equal weight," citing challenging comparisons and near-peak valuations.
The brokerage sector is expected to benefit broadly from stable equity markets and higher interest rates, which supported robust performance in 2024. Schwab, in particular, is positioned for strong medium-term earnings growth as cash levels stabilize and funding costs ease.