Not long ago, Wall Street viewed crypto with a mixture of suspicion and contempt. The space created by Bitcoin is mostly mocked by the mainstream finance world. It’s just a fad, right? A bubble that would soon end in tears for all involved and a haven for criminal activities.
This view is certainly no longer the case. As the trend refused to die and the ecosystem flourished, Wall Street slowly came to the idea that crypto is here to stay.
The extent of the transformation of financially bad boy into the possible future of global payments has recently been justified with the public listing of Coinbase (COIN). The cryptocurrency exchange made a beautiful start last week with a NASDAQ listing of $ 75.9 billion. Is all the hoopla earned?
Rosenblatt Securities, Sean Horgan, thinks so.
“We are positive about the long-term rise of COIN as it benefits from the growing acceptance and acceptance of cryptocurrency, while our short-term view is more cautious as equities pose a downward risk due to a reduction in the price of crypto, “the analyst said. “In our view, sustainable long-term growth is less uncertain, and our expectations are potentially conservative, given the upside risk of institutional adoption and subscriber growth.”
And Coinbase is definitely growing. In 2020, the company generated revenue of approximately $ 1.3 billion, increasing 144% year-on-year. In the first quarter of the year alone, the company’s revenue reached $ 1.8 billion.
Although, as Horgan notes above, Coinbase falls to some extent under the grace of the crypto cycle, which is currently going through one of its training phases. However, the withdrawals are notorious and the bear markets are long.
That said, crypto has reached a “turning point in the way of legitimacy,” and Horgan believes it is a “long-lasting disruptive trend that is only in the early turn.”
There is evidence to substantiate the claim. The institutions have moved in and are now picking up Bitcoin to store as a digital equivalent of gold. And as the recent launch of crypto-trading on Venmo, the PayPal-owned payment service, can attest, the network effect will create further demand and businesses will likely see the value in offering a crypto-settlement option to sell. ”
“As this ecosystem develops and becomes more valuable, COIN is a way to capture the upside,” the analyst summed up. “Net / net, we are buyers of COIN as a long-term category leader and pure-play crypto-currency stock.”
Consequently, Horgan started covering COIN with a buy rating and price target of $ 450. The implication for investors? Upside down of 44%. (To see Horgan’s record, click here)
Horgan’s colleagues agree. Based on only Buys – 5 in total – the stock has a strong buy consensus rating. The average price target is also positive, at $ 479.83 indicating a ~ 50% increase over the next 12 months. (See COIN stock analysis on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the proposed analyst. The content is for informational purposes only. It is very important to do your own analysis before investing.