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."
Sign up for Kiplinger’s Free E-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
-
USPS Is Raising Prices for Holiday Shipping: Dates and Increases You Need to KnowWhat the USPS's $16 price hike means for your wallet and your small business.
-
July CPI Report Ignites a Risk-On Rally: Stock Market TodayMarket participants price out worst-case scenarios for tariffs and inflation and will now turn their attention to employment and growth.
-
July CPI Report Ignites a Risk-On Rally: Stock Market Today
Market participants price out worst-case scenarios for tariffs and inflation and will now turn their attention to employment and growth.
-
July CPI Report Boosts Rate-Cut Odds: What the Experts SayThe July CPI report shows that tariffs are having a slight impact on inflation, though not enough to keep the Fed from cutting interest rates.
-
DST Exit Strategies: An Expert Guide to What Happens When the Trust SellsUnderstanding the endgame: How Delaware statutory trust dispositions work, what investors can expect and why the exit is probably more important than the entrance.
-
Think Selling Your Home 'As Is' Means You'll Have No Worries? Think AgainThere are significant risks and legal obligations involved in selling a home 'as is' and by yourself, without a real estate agent.
-
Stocks Slip Ahead of July CPI Report: Stock Market TodayThe latest inflation updates roll in this week and Wall Street is watching to see how much of an impact tariffs are having on cost pressures.
-
What the OBBB Means for Social Security Taxes and Your Retirement: A Wealth Adviser's GuideFor Americans in lower- and middle-income tax brackets, the enhanced deduction for older people reduces taxable income, shielding most of their Social Security benefits from being taxed.
-
Financial Planner vs Investment Manager: Who's the Better Value for You?When markets are shaky, who do you trust with your money? A recent study provides useful insights into the value that different financial professionals offer.
-
I'm a Financial Adviser: This Is How You Could Be Leaving Six Figures in Social Security on the TableClaiming Social Security is about more than filing paperwork and expecting a check. When you do it and how you do it have huge financial implications that last the rest of your life.
