Bank of America has started coverage of Coinbase Global. The bank has identified several factors that could boost Coinbase’s revenues. Regarding the crypto exchange’s plan to become “the Amazon of crypto assets,” Bank of America says it is “at a very early stage”.
Bank of America expects concrete progress against Coinbase’s long-term vision.
Bank of America (Bofa) began reporting on Coinbase Global Inc. (Nasdaq: COIN) on Friday. Jason Kupferberg, Senior Equity Research Analyst at Bank of America Merrill Lynch, started Coinbase with a “neutral” rating and a price target of $ 273.
While the analyst sees Coinbase as a “leading provider of crypto infrastructure,” he cautioned that its stock, which trades at 18.3 times sales, could have limited upside potential in the short term. He described:
COIN aims to become the Amazon of Crypto Assets, although we believe the COIN model is still in the very early stages of development and we are waiting for more concrete signs of progress against the long-term vision of COIN.
Brian Armstrong, CEO of Coinbase, said during the conference call last week on the second quarter 2021 results, “We want to be the Amazon of assets, listing every asset out there in crypto that is legal. There are thousands of them today. There will be millions of them after all. All of this is under the motto of decentralization. “
The Bank of America analyst is looking for Coinbase to diversify away from crypto trading fees, which currently account for 95% of the company’s revenue. He noted that services like staking and lending are gaining traction in the exchange, and pointed out that subscriptions and services represent significant cross-sell opportunities that could increase Coinbase’s average revenue per user.
Several investment banks now cover Coinbase Global. Wedbush Securities began coverage of Coinbase in May with a target price of $ 275. The company raised its price target on the stock market last week from $ 275 to $ 300 and gave the stock an “Outperform” rating.
In July, Mizuho lowered the price target for Coinbase from USD 225 to USD 210, while Oppenheimer raised the price target for COIN from USD 434 to USD 444. Raymond James began coverage of Coinbase in June with an “Outperform” rating.
JPMorgan and Goldman Sachs started reporting on Coinbase in May. Goldman started with a “Buy” rating and a target price of $ 306 on COIN. JPMorgan began with an “overweight” rating, largely due to the company’s key position in the growing cryptocurrency space. The company set its price target for Coinbase at $ 371.
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