TLDR
- BofA upgraded Coinbase to Buy with a $340 price target despite a 40% stock decline since July’s all-time high
- The firm views the pullback as crypto market correction, not company-specific weakness
- Coinbase expanded into stock and ETF trading and prediction markets to become an “everything exchange”
- Barclays maintained Equal Weight rating and cut price target from $291 to $258 citing trading volume and USDC growth concerns
- Q3 revenue rose 55% to $1.9 billion with subscription services now representing 40% of total revenue
Coinbase Global Inc. received a fresh vote of confidence from Bank of America this month. The investment bank upgraded shares to Buy from Neutral on January 8.
BofA kept its $340 price target unchanged. The move comes after the stock fell 40% from its July all-time high.
The bank blamed broader crypto market weakness for the decline. BofA analysts found no issues with Coinbase’s fundamentals or business operations.
The firm pointed to expanding market opportunities for the company. Coinbase has accelerated its product launches in recent months.
The platform recently added stock and ETF trading capabilities. It also entered the prediction markets space.
These moves align with management’s vision of building an “everything exchange.” The strategy aims to reduce dependence on crypto trading alone.
BofA sees these expansions as chances to sell more products to existing users. The cross-selling potential could drive future revenue growth.
Mixed Analyst Views
Not everyone shares BofA’s optimism. Barclays maintained its Equal Weight rating around the same time.
The firm cut its price target from $291 to $258. Analysts cited several concerns in their Q4 model.
Lower trading volumes topped the list of worries. Barclays also expects slower USDC stablecoin growth.
Continued crypto price volatility remains a concern. These factors could weigh on near-term results.
The company plans to report Q4 earnings in late February. That report will test both bull and bear cases.
Strong Momentum Despite Concerns
Third quarter results showed impressive growth. Revenue climbed 55% year-over-year to $1.9 billion.
Adjusted EBITDA jumped 78.3% to $801 million. The company’s business mix continues to evolve.
Subscription and service revenue hit 40% of total revenue in Q3. This shift away from trading fees creates more stable earnings.
Platform assets reached $516 billion at quarter end. Institutional money flows drove much of that growth.
Stablecoins emerged as a major revenue driver. The segment generated $355 million in Q3 revenue.
Coinbase holds $15 billion in USDC balances on its platform. These funds generate interest income for the company.
USDC adoption for payments keeps more money on the platform longer. This creates a reliable revenue stream.
The regulatory picture is improving for crypto companies. U.S. lawmakers scheduled key hearings and votes for January 2026.
These meetings will establish clearer rules for trading and regulating digital assets. Better regulation could boost institutional participation.
Coinbase is working to comply with Europe’s MiCA framework. The company submitted required disclosures to meet EU standards.
Wall Street consensus leans positive on the stock. Nearly two-thirds of analysts rate it Buy.
The average price target implies 55% upside over the next year. Coinbase serves as custodian for most U.S. spot Bitcoin and Ethereum ETFs.
This role generates recurring custody fees as more capital flows into crypto ETFs. The positioning should strengthen as institutional adoption grows.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
