From Nasdaq
May 12, 2025 11:39:00 AM:

Coinbase Global (COIN) reported mixed first-quarter 2025 results, with the bottom line beating estimates but the top line missing. Total trading volume increased by 26% year over year, with adjusted EBITDA at $929.9 million, an 8.3% decrease from the previous year.

President Trump’s support for crypto and clear regulatory frameworks benefit Coinbase. With 83% of revenues from the U.S., Coinbase is a preferred platform for businesses incorporating cryptocurrency. Q1 2025 EPS beat estimates by 4.9%, with revenues at $2 billion, a 24% increase year over year.

Transaction revenues rose 18.2% to $1.3 billion, driven by consumer and institutional transactions. Subscription and services revenues increased by 36.3% to $698.1 million, attributed to higher Stablecoin revenues. Operating expenses increased by 51.5% to $1.3 billion.

COIN shares have fallen by 19.7% YTD, underperforming the industry, sector, and S&P 500. Robinhood Markets (HOOD) and Interactive Brokers Group (IBKR) have seen gains. COIN has been trading above its 50-day moving average, indicating a short-term bullish trend.

Analysts predict a downside for COIN, with an average target price of $262.35 per share suggesting a 27.1% upside from the last closing price. Muted analyst sentiment has seen estimates decrease for 2025 and 2026. COIN shares are considered expensive compared to the industry.

Factors favoring COIN include its position as the largest registered crypto exchange in the U.S., with plans for growth and market expansion. The acquisition of Deribit and expansion into new markets like Argentina and India show promise. COIN’s strong liquidity and positive EBITDA for nine consecutive quarters bolster its position.

COIN’s return on equity and invested capital surpass industry averages, reflecting efficient fund utilization. While fluctuations in crypto asset prices pose risks, COIN remains focused on growth and innovation in the crypto space. With a premium valuation and muted analyst sentiment, a cautious approach is advised for this Zacks Rank #3 (Hold) stock.

Read more at Nasdaq: Should Coinbase Global Stock Be in Your Portfolio Post Q1 Earnings?