Investment Outlook for Coinbase Global

Investing.com – Coinbase Global is poised to excel in the evolving cryptocurrency market, as indicated by Monness, Crespi, Hardt. They initiated coverage with a Buy rating and a $245 price target in a note released on Monday.

Despite challenges posed by near-term volatility, the firm regards Coinbase (NASDAQ: COIN) as a pivotal player with a solid foundation for long-term success.

> “We see Coinbase as a long-term crypto Exchange/Custody/Services winner, owing to its first-mover advantage, superior technology, and leading compliance,” the analysts reported.

The analysts underscored Coinbase’s influence in the emerging multi-chain future, suggesting it is well-positioned to reap benefits as decentralized finance protocols become more prominent.

The note also mentions Coinbase's initiatives to tackle scalability issues through Ethereum Improvement Plans (EIPs) and its proactive lobbying efforts to bring the crypto industry into the mainstream.

Monness, Crespi, Hardt highlighted Coinbase’s involvement with USDC and the recent appointment of Jesse Pollak, the creator of Base, to lead Coinbase Wallet as indicators of strategic progress in transaction processing.

With a substantial user base of 110 million verified users and 8.2 million monthly transacting users, the analysts note compelling economics for the company.

This user base, coupled with incremental conversions to monthly users and geographic expansions, is expected to maintain strong unit economics through both crypto booms and busts.

The analysts also believe that subscription services like Coinbase One could enhance average revenue per user (ARPU).

While Coinbase faces regulatory hurdles, including an ongoing SEC lawsuit, Monness, Crespi, Hardt believes these legal uncertainties may create attractive buying opportunities.

“This could be an overhang, but likely creates opportunities for compelling entry points around the timing of the case,” the note asserted.

In conclusion, the analysts stated that Coinbase’s emphasis on safety, technology, and compliance renders it appealing to both institutional and retail users, offering stability in an unpredictable market. Their $245 price target reflects 23x EV/EBITDA on projected 2025 earnings of $2.7 billion.