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Here's Why Hold Strategy is Apt for Coinbase Global (COIN)

Coinbase Global, Inc. COIN has been in investors’ good books on the back of higher institutional interest, higher Monthly Transacting Users (MTU), improved average crypto asset prices and total crypto spot market volumes.

Zacks Rank & Price Performance

Coinbase Global currently carries a Zacks Rank #3 (Hold). In the past year, the stock has lost 84.4% compared with the industry’s decline of 32.5%.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Business Tailwinds

Coinbase Global is likely to gain from increased adoption of a greater number of crypto assets, higher volatility and a rise in interest across the entire crypto economy.

Higher interest income, growing blockchain rewards and increased subscription fees for Coinbase One are likely to drive subscription and services segments’ revenues. For 2022, Coinbase Global expects revenues for the same to be more than $700 million.

Ethereum’s trading volume growth is likely to have been aided by an increase in institutional interest, the launch of Ethereum 2.0 staking products, and growth in DeFi and NFT.

Higher MTU and elevated trading volumes per MTU are likely to have aided retail transaction revenues. The annual average retail MTU is expected to be between 7 million and 9 million in 2022.

Improved transactional revenues coupled with subscription and service segments’ revenues are likely to drive the top line of COIN.

Increase in both the average crypto asset prices and total crypto spot market volumes is likely to have driven the overall trading volume of COIN.

Coinbase Global boasts a solid financial position and expects sufficient liquidity to fund its business through a prolonged stressed market environment.

Stocks to Consider

Some better-ranked stocks from the finance sector are Allianz SE ALIZY, Ameriprise Financial, Inc. AMP and Affiliated Managers Group, Inc. AMG, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Allianz’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average earnings surprise being 12.96%. In the past year, the insurer has lost 6.7%.

The Zacks Consensus Estimate for ALIZY’s 2022 and 2023 earnings has moved 4.4% and 3.8% north, respectively, in the past 30 days.

Ameriprise Financial’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average beat being 4.83%. In the past year, Ameriprise Financial has rallied 8.2%.

The Zacks Consensus Estimate for AMP’s 2022 and 2023 earnings indicates 7.9% and 18.4% year-over-year growth, respectively.

Affiliated Managers’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average beat being 5.20%. In the past year, Affiliated Managers has lost 5.8%.

The Zacks Consensus Estimate for AMG’s 2022 and 2023 earnings has moved 8.4% and 5.8% north, respectively, in the past 30 days.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Ameriprise Financial, Inc. (AMP) : Free Stock Analysis Report

Affiliated Managers Group, Inc. (AMG) : Free Stock Analysis Report

Allianz SE (ALIZY) : Free Stock Analysis Report

Coinbase Global, Inc. (COIN) : Free Stock Analysis Report

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Zacks Investment Research