JPMorgan Analyst Revises Bearish Outlook on Coinbase
A JPMorgan analyst has revised his previously bearish outlook on Coinbase Global Inc., leading to a 7.8% climb in the stock on February 15. This change is a reversal of his January prediction that the enthusiasm for the US-listed spot Bitcoin ETFs might wane. His decision is influenced by the cryptocurrency market’s buoyant performance as well as the elevated cryptocurrency prices, and he upgraded Coinbase to a neutral rating.
Reassessing Coinbase’s Earnings Potential
Worthington’s reassessment is rooted in the recent influx of investments into new spot Bitcoin ETFs and the appreciable rise in the prices of major cryptocurrencies. He anticipates that the elevated cryptocurrency prices will persist and enhance Coinbase’s activity levels and earnings potential, especially looking towards the first quarter of 2024.
Wall Street Mixed Despite Surge
Despite a nearly 400% surge in 2023, Wall Street’s opinion on Coinbase remains mixed, with analysts almost evenly split between buy, hold, and sell recommendations. Worthington has maintained his $80 price target on the stock, ahead of Coinbase’s earnings report expected to be released after the market was closed on Thursday.
Reflection of Trends in Coinbase’s Shares Sales
In related news, CoinDesk reported that ARK Invest, led by Cathie Wood, divested $34.3 million worth of Coinbase shares across three funds, marking its first sale since January 11. This move comes amidst expectations for Coinbase to report stronger earnings and revenue, driven by a surge in trading volume as the crypto market rallied, a trend also reflected in Robinhood’s 10% increase in crypto revenue for Q4 2023.
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