To The Moon

$Webull Corp(BULL)$

Robinhood has been one of the standout stocks of 2025, surging more than 140% year-to-date and rewarding shareholders handsomely — my own position in the stock is up over 200%. Meanwhile, chatter among investors on X suggests that WeBull, which just went public and recently turned profitable, could be “Robinhood 2.0.” So far, though, its performance has been much more muted — up just about 23% year-to-date, nowhere near Robinhood’s explosive gains.

As a Robinhood shareholder and long-term observer of the space, I’ve taken a closer look at WeBull to assess whether it presents a generational buying opportunity or if it’s more likely a trap that could head much lower. Below, I share my findings.

WeBull’s Business at a Glance

WeBull is widely seen as the closest competitor to Robinhood. Its highly interactive platform appeals to younger traders, with a strong focus on options, equities, and futures trading. Unlike Robinhood, WeBull is not positioned as a platform for long-term investors seeking retirement planning or wealth management.

WeBull has been growing its user base quickly, now reporting 24.1 million registered users — up 17% year-over-year. But only 4.7 million of those are funded accounts, which grew just 10%. The gap between registered and active funded accounts is noteworthy.

WeBull earns revenue mainly through two channels:

• Trading activity fees: Primarily from equities ($18.8M) and options trading ($53.4M), plus platform fees ($9.5M).

• Margin and lending income: From securities lending and interest on cash balances.

Trading volumes have increased, but interest income has declined quarter-over-quarter due to falling market rates — a headwind that’s macro-driven rather than company-specific.

Growth Roadmap Looks Promising

WeBull’s management has outlined an ambitious growth plan for 2025:

• Launching the WeBull app in Latin America — a large, untapped market.

• Relaunching crypto trading in the U.S., which could significantly boost revenue given crypto’s popularity among its core demographic.

• Re-entering the Netherlands and introducing support for mutual funds.

Turning profitable in Q1 2025 marked a major milestone, with improving net income trends every quarter. But the sustainability of profitability remains to be proven.

Concerning Trends and Risks

Despite its growth roadmap, several red flags warrant caution:

1. Declining Net Deposits

Net deposits have declined for three consecutive quarters, even as Robinhood’s deposits have continued to rise. Year-over-year growth remains positive, but the quarterly trend is clearly unfavorable.

2. Weak Competitive Moat

WeBull’s business model is highly replicable. Robinhood offers similar functionality — and more — with its Gold program. Features like 3% cashback on its credit card, IRA match, discounted mortgages, and managed accounts create a sticky ecosystem that’s harder for customers to leave.

By contrast, WeBull users can easily switch to Robinhood for better perks without losing much. This lack of competitive differentiation is a serious weakness.

3. Chinese Ownership Overhang

WeBull maintains significant ties to Chinese entities and has faced regulatory scrutiny in the U.S. for this reason. Its CEO has acknowledged that WeBull is “both a U.S. and a Chinese company,” which raises long-term geopolitical and regulatory risks — a persistent “China discount” that investors cannot ignore.

4. Immediate Capital Needs

Shortly after going public, WeBull announced a plan to issue Series A stock at a discount to raise $1 billion — an unusual move for a newly listed company. This suggests funding pressures that could dilute shareholders.

5. Stagnant Growth

Over the past three years, revenue growth has essentially flatlined, only recently rebounding by ~32% in Q1. Betting on WeBull today assumes a reversal of this trend — a speculative proposition at best.

Peer Comparison: Webull vs. Robinhood, SoFi, and Interactive Brokers

Narrative: How Webull Stacks Up

Robinhood (HOOD): Robinhood remains the leader in retail trading apps, with a sticky customer base thanks to its Gold subscription, high‑yield cash management, IRA matching, and recently launched mortgage and credit card products. Its ecosystem makes switching away more difficult, which Webull cannot yet replicate. Robinhood’s revenue mix is more diversified, and its path to consistent profitability is proven.

SoFi (SOFI): SoFi has built a different kind of fintech business, with a full banking license enabling it to capture deposits and lend profitably. It has less exposure to pure trading and more emphasis on financial services and cross‑selling. Its valuation is also much lower relative to revenues, reflecting a more modest investor expectation, but arguably more predictable growth.

Interactive Brokers (IBKR): IBKR is a mature, highly profitable brokerage firm with global operations and an institutional clientele. Its product depth and margin lending expertise put it in a different league than retail‑focused apps like Webull.

Webull’s Position: Webull sits squarely in the middle: not as sticky or diversified as Robinhood, not as institutional as IBKR, and lacking a banking license like SoFi. Its business is highly exposed to short‑term trading activity, which can be cyclical. Growth opportunities in crypto and LATAM expansion exist, but the competitive moat remains shallow, and the Chinese ownership overhang adds uncertainty.

Valuation: Too Rich for the Risks

WeBull currently trades at an eye-watering ~16.6× trailing revenues — not earnings, revenues. For a company with limited competitive advantages, inconsistent growth, and geopolitical risks, this multiple appears unjustifiable. Robinhood, by comparison, offers better stickiness, scale, and profitability.

WeBull’s potential catalysts — crypto relaunch, international expansion — may drive some growth, but the current price already bakes in significant execution success.

Verdict: AVOID

WeBull is a speculative bet with more risks than rewards at current levels. While its growth story could eventually play out, I don’t see a favorable enough risk/reward to justify a position. There are better opportunities elsewhere in the market.

• Current Price: High relative to fundamentals

• Valuation: ~16× trailing revenues, not earnings

• Growth Outlook: Mixed, with some catalysts but weak competitive moat

• Profitability: Recently turned profitable, but sustainability uncertain

Webull has achieved impressive milestones — a growing user base, its first profitable quarter, and ambitious plans to expand in Latin America and relaunch crypto in the U.S. These are all positives.

However, the risks outweigh the rewards at today’s price:

• Net deposits have declined three straight quarters, signaling customer churn or weaker engagement.

• Direct competition from Robinhood, which offers a stickier ecosystem and superior user perks.

• Continued regulatory and geopolitical overhang due to Chinese ownership ties.

• Immediate need to raise $1B in equity shortly after going public, diluting shareholders.

• Revenue growth has been stagnant for 3+ years and only recently showed signs of life.

At ~16× revenues, the stock already prices in a perfect execution of its growth roadmap — leaving little margin of safety for investors if challenges persist.

Who Might Hold?

Investors who are already in the stock, have a high risk tolerance, and believe in management’s ability to execute their aggressive expansion plan may choose to hold — but should keep position sizes modest and watch key metrics (net deposits, profitability, and international traction) closely.

The Bottom Line: Not the Next Robinhood

WeBull is not the next Robinhood. While it has potential, it faces an uphill battle against a better-capitalized, more entrenched competitor that continues to innovate and add value for its users. WeBull’s lack of a moat, regulatory overhang, and rich valuation skew its risk-reward profile unfavorably.

Webull is currently the least compelling of its peer group, given its risk factors and competitive disadvantages. Investors looking for growth in the fintech or brokerage space are better served with Robinhood, SoFi, or IBKR — all of which have stronger competitive positions, lower risk, and more defensible valuations.

For investors looking for high-growth fintech exposure, there are better options with more predictable business models and stronger competitive advantages. WeBull could succeed if management executes perfectly — but that’s a big “if.”

Disclaimer: I want to make it clear that I am not a financial advisor, and nothing I say is intended to be a recommendation to buy or sell any financial instrument. Additionally, it's important to remember that there are no guarantees or certainties in trading or investing, and you should never invest money that you can't afford to lose.

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