Shares of Robinhood (NASDAQ: HOOD) are trading sharply higher on Thursday, surging 15.2% and heading toward their strongest single-day performance since August 21. The move comes as Wall Street analysts point to prediction markets as a fresh growth avenue for the brokerage platform.

Deutsche Bank analyst Brian Bedell stated that corporate KPI (Key Performance Indicator) contracts are likely to become the industry's next major growth area. He added that these contracts, which are tied to corporate financial metrics, have the potential to become the largest category of event contracts in the future.

"We continue to believe that corporate KPI contracts will become the largest event contract asset class," Bedell wrote in a research note. "Even if the Supreme Court issues a ruling favoring a national regulatory framework, we project that trading volume in U.S. corporate KPI contracts will surpass $1 trillion by 2028, exceeding the volume of sports-related event contracts."

At 10:51 a.m. ET, Robinhood shares were trading at $123.21, up $16.22 (15.16%) on the New York Stock Exchange Arca platform.

The analyst also noted that if Cboe Global Markets secures approval from the U.S. Securities and Exchange Commission (SEC), it would gain a first-mover advantage in the corporate KPI contract space, with online brokers likely to be among the initial clients. "On this theme, Cboe is best positioned, followed by Robinhood," Bedell commented. He further highlighted that Robinhood stands to benefit both from client trading activity and from the future launch of related products on its Rothera platform.