Coinbase (COIN) went flat 1st quarter Broker JMP said in a research report on Thursday that it has benefited from improved crypto market conditions and business diversification efforts.
The cryptocurrency exchange reported first-quarter net income of $1.2 billion and diluted earnings per share (EPS) of $4.40. The proceeds include approximately $650 million in mark-to-market gains on crypto assets held for investment purposes. Bitcoin (BTC), the world's largest cryptocurrency, rose more than 34% in the first quarter, while the CoinDesk 20 Index (CD20) rose nearly 17%.
The broker reiterated its market outperform rating and $320 price target. Canaccord Genuity maintained a buy rating and raised its price target from $240 to $280. KBW also raised its price target to $240 from $230 and reiterated its market performance rating. Shares fell 3.6% to $220.62 in early trading Friday.
“While we believe investors must remain calm about the ebb and flow of enthusiasm for the industry, which often coincides with price fluctuations, we believe that Coinbase is relevant in virtually every sector. “We see a number of fundamental trends that support our positive hypothesis that the company will become a competitive player,” JMP analysts led by Devin Ryan wrote.
Areas that JMP is most excited about with Coinbase include the introduction of Coinbase Prime, a smart wallet, and expanding international opportunities.
Canaccord Genuity said in a report Thursday that consumer and institutional transaction revenue grew 101% and 133%, respectively, quarter over quarter.
Analysts led by Joseph Vuffy said this growth was driven by “continued investment in product offerings and an increase in active users, as well as improved broader market activity from spot exchange-traded funds (ETFs). “It was.”
The broker said it was boosted by the launch and traction of Coinbase's Layer 2 blockchain 'Base'. “We believe this Layer 2 launch will help solidify COIN’s leadership position by driving lower cost transactions across our growing user/AUM base.”
Coinbase also recorded strong growth balances in both platform and market capitalization for its USDC stablecoin, which led to $197 million in revenue, broker KBW said in a report on Friday. USDC is stable coin Issued by the circle itself Supported by Coinbase. The company derives gross interest income from USDC outstanding balances.
Looking ahead, KBW said it is cautious about USDC balances due to the recent rapid growth of its business and “the assumption that balances will eventually subside once interest rates begin to fall.” USDC is balanced in the short term. ”
