Why Coinbase Stock Is Lower After a Blowout Earnings Report
Coinbase stock is tumbling Friday as investors take profits following the crypto platform's impressive fourth-quarter results. Here's what you need to know.
Coinbase Global (COIN) stock dropped sharply out of the gate Friday even after the cryptocurrency exchange far surpassed top- and bottom-line expectations for its fourth quarter.
In the three months ending December 31, Coinbase's revenue increased 138.2% year over year to $2.3 billion. Its earnings per share (EPS) more than quadrupled from the year-ago period to $4.68.
"Coinbase delivered strong Q4 and full-year 2024 results," the company said in its shareholder letter. "Zooming out, the last few months have demonstrated a sea change in the regulatory environment, unlocking new opportunities for Coinbase and the crypto industry."
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The results trounced analysts' expectations. Wall Street was anticipating revenue of $1.9 billion and earnings of $1.81 per share, according to CNBC.
Coinbase also said trading volume nearly tripled year over year to $439 billion, thanks to a 224% increase in consumer trading volume to $94 billion and a 176% surge in institutional trading volume to $345 billion.
"Crypto's voice was heard loud and clear in the U.S. elections, and the era of regulation via enforcement that crippled our industry in the U.S. is on its way out," Coinbase added. "The Trump administration is moving fast to fulfill its promise of making the U.S. the crypto capital of the planet, and globally, leaders are taking notice and increasing their attention and investment into crypto."
Is Coinbase stock a buy, sell or hold?
Heading into Friday's session, Coinbase Global shares had doubled on a year-over-year basis, so the post-earnings pullback could be a result of investors taking some profits. Still, Wall Street thinks the financial stock has more room to run.
According to S&P Global Market Intelligence, the average analyst target price for COIN is $320.71, representing implied upside of nearly 15% to current levels. Additionally, the consensus recommendation is a Buy.
Financial services firm Needham is one of those with a Buy rating on the large-cap stock alongside a $330 price target.
"We view Coinbase as an attractive way to play the growing crypto asset universe, which includes overlap in the high-growth areas of stablecoins, decentralized finance (DeFi), non-fungible tokens (NFTs), exchanges in spot/derivatives, and blockchains (Base)," says Needham analyst John Todaro.
Over the long term, Todaro expects the company to "broaden its applications to include a variety of crypto-related financial services activities," while near-term growth will come from "its staking offering as more crypto networks move to a proof-of-stake consensus algorithm and its stablecoin interest account offerings."
Related Content
-
How to Avoid Medicare Late Enrollment Penalties ForeverWhether you are still working or planning to retire this year, understanding the 2026 late penalties for Parts A, B and D is essential for your financial health.
-
The New Fed Chair Was Announced: What You Need to KnowPresident Donald Trump announced Kevin Warsh as his selection for the next chair of the Federal Reserve, who will replace Jerome Powell.
-
Ask the Tax Editor: Taxation of Social Security BenefitsAsk the Editor In this week's Ask the Editor Q&A, Joy Taylor answers questions on the taxation of Social Security benefits
-
The New Fed Chair Was Announced: What You Need to Know
President Donald Trump announced Kevin Warsh as his selection for the next chair of the Federal Reserve, who will replace Jerome Powell.
-
If You'd Put $1,000 Into AMD Stock 20 Years Ago, Here's What You'd Have TodayAdvanced Micro Devices stock is soaring thanks to AI, but as a buy-and-hold bet, it's been a market laggard.
-
6 Key Ways to Plan for Financial Success in 2026 (and Avoid a Portfolio 'Death Spiral')Use last year's tax data to help guide you as you consider this year's taxes, asset allocation and sources of the regular income you'll need in retirement.
-
A Financial Plan Is a Living Document: Is Yours Still Breathing?If you've made a financial plan, congratulations, but have you reviewed it recently? Here are six reasons why your plan needs regular TLC.
-
Nasdaq Drops 172 Points on MSFT AI Spend: Stock Market TodayMicrosoft, Meta Platforms and a mid-cap energy stock have a lot to say about the state of the AI revolution today.
-
Your Guide to Financial Stability as a Military Spouse, Courtesy of a Financial PlannerThese practical resources and benefits can help military spouses with managing a budget, tax and retirement planning, as well as supporting their own career
-
3 Steps to Keep Your Digital Data Safe, Courtesy of a Financial PlannerAs data breaches and cyberattacks increase, it's vital to maintain good data hygiene and reduce your personal information footprint. Find out how.
-
Here's Why You Can Afford to Ignore College Sticker PricesCollege tuition fees can seem prohibitive, but don't let advertised prices stop you from applying. Instead, focus on net costs after grants and scholarships.
