Coinbase receives neutral upgrade from Goldman Sachs, along with a new price target.
Goldman Sachs has revised its assessment of Coinbase, upgrading its rating from sell to neutral and establishing a new price target of $282 for the company’s stock. This adjustment, announced on Thursday, reflects a change in Goldman Sachs’ perspective on Coinbase, influenced by recent bullish trends in the cryptocurrency market.
According to blockchain analysis firm Kaiko, Coinbase’s market share in the United States has increased by 13% following the Securities and Exchange Commission’s approval of 11 new spot Bitcoin exchange-traded funds (ETFs) in January.
The increase in Coinbase’s stock rating is in line with the surge in cryptocurrency prices and a significant rise in daily trading volumes on the platform. On January 11, the day the Bitcoin ETFs began trading, Coinbase witnessed nearly $5 billion in trading volume, surpassing its 2023 volume and approaching the volume on the day FTX filed for bankruptcy in November 2022.
Despite experiencing technical difficulties during periods of high volatility, Coinbase achieved a record volume of around $12 billion on March 6.
As a result of these developments, Goldman Sachs has raised its revenue forecast for Coinbase by 48%. In mid-February, Coinbase reported a profit of $273.4 million for the quarter, a significant improvement over a $557 million loss in the same quarter the previous year. This marks a substantial turnaround from a $2 million loss reported in the third quarter of 2023.
Goldman Sachs’ previous sell rating was based on concerns about the long-term viability of the cryptocurrency market. However, recent market performance and adoption rates have prompted a reassessment, with the new price target indicating a more positive short-term outlook for Coinbase in the current market rally.
