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Coinbase Stock: Is there Room for More Growth?

Coinbase (NASDAQ:COIN) has become a popular option for many crypto investors. This crypto exchange has managed to become a top choice for those seeking publicly traded exposure to...
Coinbase Stock: Is there Room for More Growth? © Reuters. Coinbase Stock: Is there Room for More Growth?

Coinbase (NASDAQ:COIN) has become a popular option for many crypto investors. This crypto exchange has managed to become a top choice for those seeking publicly traded exposure to the crypto sector today.

However, since Coinbase's IPO, some significant volatility has ensued. The company's IPO price of $250 per share was quickly eviscerated by investor interest. On the first day of trading, COIN stock surged to $429.54 at its peak, before closing the day at $328.28.

However, since then, shares of COIN stock have steadily declined. Today, investors can pick up shares of Coinbase for roughly the company's IPO price. (See COIN stock charts on TipRanks)

For the largest cryptocurrency exchange in the U.S., perhaps there's some real value to be had with COIN stock right now. After all, cryptocurrency volumes are surging, alongside interest in this sector. More than 50 cryptocurrencies are available to be traded on Coinbase, covering most of the popular and highly traded tokens.

There's certainly reason to believe Coinbase's transaction fee-driven business model is poised for long-term success. Surging crypto prices are bullish for interest in this sector, which could drive valuation increases over time. Right now, I remain on neutral with respect to Coinbase.

COIN's Huge Earnings Potential

Ahead of its debut, COIN presented its Q1 estimates on April 6. The company also issued an outlook for Fiscal Year 2021.

In May, the company issued Q1 earnings that slightly missed Wall Street estimates. It showed total revenue of $1.8 billion, with earnings per share of $3.05. However, Wall Street expected the company to earn $1.81 billion, with EPS of $3.07.

Still, COIN earnings soared 2,350%, and sales reached 845% compared to the previous fiscal year.

This past quarter, Coinbase's earnings accelerated higher. The company showed earnings of $6.42 per share on sales of $2.2 billion. However, Coinbase projected slightly lower transaction volumes for Q3, leading to more selling pressure for this hyper-growth stock.

Given these mixed bags of results, investors may not know where to stand on COIN stock. Here are a few other factors to consider.

Rebound in Hash Rate Signals Continued Growth?

A few months ago, the entire crypto industry was in flux over a high-profile crackdown on cryptocurrency miners by the Chinese government.

Given China's importance to global cryptocurrency mining operations (around two-thirds of the world's Bitcoin mining capacity comes out of China), this was a big deal. The global hash rate got cut in half following this announcement, in just two-and-a-half weeks. Hash rate measures the computing power used in crypto mining processes.

Accordingly, this sharp volatility renewed concerns about China's importance to stabilizing crypto prices. Concerns from prominent Bitcoin players that the crackdown could intensify drove Bitcoin prices, and by extension, those of crypto exchanges such as Coinbase, lower.

However, a recovery in the global hash rate has sparked renewed fervor in the cryptocurrency space. Investors seem to feel more confident than ever that the growth cryptocurrencies have seen thus far can be continued.

That said, many remain on the fence during this volatile time.

Wall Street's Take on COIN Stock

As per TipRanks' analysts rating consensus, COIN stock is a Moderate buy. Out of 15 ratings, there are 11 Buy recommendations, three Hold recommendations, and one Sell recommendation.

The average COIN price target is $350.17. The average price target lies between a high of $500 per share, and a low of $220 per share.

Bottom Line

Coinbase has done an impressive job of allowing new cryptocurrencies to trade on its platform. An improved outlook stemming from stabilization in the crypto mining sector, and continued interest in cryptocurrencies, makes Coinbase an intriguing stock right now.

However, COIN stock has underperformed of late. There are concerns about this cryptocurrency exchange's cash balance, as well as its long-term outlook, should a bear market take hold in crypto.

Right now, everything's moving along fine. But the winds can change quickly. Investors should be prepared for anything with COIN stock.

Disclosure: At the time of publication, Chris MacDonald did not have a position in any of the securities mentioned in this article

Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of TipRanks or its affiliates, and should be considered for informational purposes only. TipRanks makes no warranties about the completeness, accuracy or reliability of such information. Nothing in this article should be taken as a recommendation or solicitation to purchase or sell securities. Nothing in the article constitutes legal, professional, investment and/or financial advice and/or takes into account the specific needs and/or requirements of an individual, nor does any information in the article constitute a comprehensive or complete statement of the matters or subject discussed therein. TipRanks and its affiliates disclaim all liability or responsibility with respect to the content of the article, and any action taken upon the information in the article is at your own and sole risk. The link to this article does not constitute an endorsement or recommendation by TipRanks or its affiliates. Past performance is not indicative of future results, prices or performance.

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24-09-2021 16:03:15 (UTC+7)

EUR/USD

1.1736

-0.0001 (-0.00%)

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Neutral

Moving Avg:

Buy (1)

Sell (11)

Indicators:

Buy (3)

Sell (2)

EUR/USD

1.1736

-0.0001 (-0.00%)

Summary

Neutral

Moving Avg:

Buy (1)

Sell (11)

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Buy (3)

Sell (2)

GBP/USD

1.3714

-0.0003 (-0.02%)

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↑ Buy

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USD/JPY

110.40

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↑ Buy

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Buy (8)

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Buy (8)

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AUD/USD

0.7279

-0.0016 (-0.22%)

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Sell

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USD/CAD

1.2680

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EUR/JPY

129.57

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EUR/CHF

1.0842

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Gold Futures

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Silver Futures

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Natural Gas Futures

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US Coffee C Futures

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Euro Stoxx 50

4,170.65

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S&P 500

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DAX

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FTSE 100

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24,192.16

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US Small Cap 2000

2,259.80

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IBEX 35

8,882.50

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↑ Buy

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BASF SE NA O.N.

63.800

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Bayer AG NA

46.45

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Allianz SE VNA O.N.

192.86

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Adidas AG

281.82

-7.16 (-2.48%)

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Neutral

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Deutsche Lufthansa AG

6.223

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Sell

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Siemens AG Class N

149.34

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10.751

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↑ Buy

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Buy (10)

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 EUR/USD1.1736Neutral
 GBP/USD1.3714↑ Buy
 USD/JPY110.40↑ Buy
 AUD/USD0.7279Sell
 USD/CAD1.2680Neutral
 EUR/JPY129.57Neutral
 EUR/CHF1.0842↑ Sell
 Gold1,755.65↑ Buy
 Silver22.690↑ Buy
 Copper4.2295↑ Sell
 Crude Oil WTI73.52↑ Buy
 Brent Oil77.62↑ Buy
 Natural Gas5.088↑ Buy
 US Coffee C193.60↑ Buy
 Euro Stoxx 504,170.65↑ Buy
 S&P 5004,448.98↑ Sell
 DAX15,561.15↑ Buy
 FTSE 1007,067.98↑ Buy
 Hang Seng24,192.16↑ Buy
 Small Cap 20002,259.80↑ Sell
 IBEX 358,882.50↑ Buy
 BASF63.800↑ Buy
 Bayer46.45↑ Buy
 Allianz192.86Sell
 Adidas281.82Neutral
 Lufthansa6.223Sell
 Siemens AG149.34↑ Buy
 Deutsche Bank AG10.751↑ Buy
Mua/Bán 1 chỉ SJC
# So hôm qua # Chênh TG
SJC Eximbank5,655/ 5,705
(-20/ -20) # 871
SJC HCM5,640/ 5,705
(-30/ -30) # 872
SJC Hanoi5,640/ 5,707
(-30/ -30) # 874
SJC Danang5,640/ 5,707
(-30/ -30) # 874
SJC Nhatrang5,640/ 5,707
(-30/ -30) # 874
SJC Cantho5,640/ 5,707
(-30/ -30) # 874
Cập nhật 24-09-2021 16:03:18
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ↀ Giá vàng thế giới
$1,755.45+9.640.55%
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Sản phẩmVùng 1Vùng 2
RON 95-IV2149021910
RON 95-II,III2139021810
E5 RON 92-II2014020540
DO 0.05S1602016340
DO 0,001S-V1637016690
Dầu hỏa1508015380
ↂ Giá dầu thô thế giới
WTI$73.40-0.2-0.27%
Brent$77.63-1.09-1.41%
$ Tỷ giá Vietcombank
Ngoại tệMua vàoBán ra
USD22.630,0022.860,00
EUR26.044,7927.400,28
GBP30.430,7031.702,11
JPY200,85212,47
KRW16,7620,40
Cập nhật lúc 15:58:31 24/09/2021
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