Cramer says Robinhood continues to be a purchase after its rocky IPO

CNBC’s Jim Cramer said Monday he believes Robinhood shares can be bought at their current levels, suggesting the brokerage has a bright future that will suit younger people’s financial tastes.

“As Robinhood moves into other forms of funding, including ‘buy now, pay later’ cards, I think [CEO Vlad Tenev’s] Army of 22 million users will grow and become more powerful, “said the Mad Money host.

“So I’m telling you Robinhood can be bought here,” added Cramer. “If Square can get 10% up on this afterpay deal, imagine what Robinhood could do if they take over someone else in the industry – think Affirm. The share would go up. “

Square’s shares rose a day after the fintech company behind the Cash app announced a $ 29 billion deal to buy Afterpay, an Australian company that offers “buy now, pay later” services.

While gains of this magnitude are unusual after a company announces plans to buy a full share of its shares, Cramer reflects investor confidence in Square’s growth, particularly when it comes to services like “buy now, pay later,” popular with millennials are and Generation Z.

Alongside Square, Cramer said that PayPal – which owns the peer-to-peer payment app Venmo, a rival to the Cash app – is another financial services company that has been shown to be adopted by younger generations.

“I think Robinhood could be next,” Cramer said as the pioneering free stock trading company expands into other areas. Robinhood already offers cash management accounts, and Tenev told CNBC last week that he hopes the company will be “the most trustworthy and culturally relevant money app in the world” in five years.

While Robinhood’s IPO was viewed as a disappointment last week, Cramer said the company’s long-term history remained promising. That’s because “companies targeting young people have scarcity value as investments,” Cramer said, claiming the same goes for stocks in fast-casual chain Chipotle, streaming device maker Roku, and the grocery delivery app DoorDash.

“That scarcity rating has allowed them to climb higher at a tremendous rate,” bodes well for Robinhood, he said.