What’s up investors, Coinbase is one of Cathie Wood strong conviction stocks
since it IPOd in March 21. And since then Ark Invest has accumulated
over $1.1bn of Coinbase stock across their Ark Invest ETFs portfolios. So collectively across
their portfolios, Coinbase is Ark Invest 7th largest holding with a 2.5% weighting.
Cathie Wood been cost averaging her position on Coinbase since April 13th up to 4.5m shares
at the end of May. So in this video, I’ll be sharing with you their company overview,
their key catalysts and coinbase stock price target for you to consider whether to have it
on your portfolio or watchlist as you deem necessary.. So let’s get straight into it.
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So with that said, let’s get straight into it and have a look at Coinbase (COIN).
Coinbase has a share price of $236.54 per share and a market capitalization of $49.5bn.
Coinbase recently listed at IPO at $328 per share in April but it has since
seen a strong selloff and pull back from that price and presently down by 27.95%.
So seems like a decent pullback presenting lots of good opportunities to buy in this dip.
Coinbase is a secure platform that makes it easy to buy, sell, and store cryptocurrency
like Bitcoin, Ethereum, and more. Most customers around the world discover and
begin their journeys with crypto through Coinbase.
Approximately 56 million verified users, 8,000 institutions,
and 134,000 ecosystem partners in over 100 countries
trust Coinbase, to easily and securely invest, spend, save, earn, and use crypto.
Trading Volume for Q1, 2021 was $335 billion. And a significant portion of their trading
volume was concentrated in Bitcoin and Ethereum at 39% and 21%, respectively.
And As of March 31, 2021, they supported 108 unique crypto assets on their platform
for trading and custody, up from 90 at the end of 2020.
Total revenue was $1.8 billion for Q1, 2021 and the total operating expenses were $813 million,
making it a 49% operating margin. And when you look at the quarter on quarter growth, this is
exponential territory and phenomenal growth, which makes it more exciting for this stock.
In their Q1,21 shareholder letter, their CEO Brian Armstrong communicated that,
their strong Q1 2021 results reflect the strength of the crypto price cycle they entered in Q4 2020.
They saw many crypto assets reach all time high prices, high levels of volatility, and increased
interest across the entire cryptoeconomy. Crypto market capitalization reached nearly
$2 trillion at the end of Q1 2021 compared to $782 billion at the end of Q4 2020. And By the end of
Q1,21 the price of Bitcoin had nearly doubled to approximately $59,000 compared to the end of 2020,
and the price of Ethereum more than doubled during this same period to approximately $1,900.
This market environment drove strong engagement with the Coinbase platform, reflected in retail,
institutional and ecosystem partner growth across all key metrics including their Verified Users,
retail Monthly Transacting Users (MTUs), Trading Volume, and Assets on the Platform.
At the same time, they continued to see their growth strategy flywheel in action.
First, through more participants than ever entered the cryptoeconomy in Q1. The Retail Monthly
Transacting Users (MTUs) grew to 6.1 million in Q1 2021, more than double compared to Q4 2020.
Second, they expanded the breadth and depth of the assets supported. Lastly, they continued to launch
innovative products that attracted new customers and deepened relationships with existing ones.
Despite their strong Q1 results, the rapid expansion of the cryptoeconomy also creates
challenges for Coinbase as competition increased as new market entrants joined the cryptoeconomy
every month. Their competitors are supporting certain crypto assets that are experiencing
large trading volume and growth in market capitalization that they do not currently support,
as well as offering new products and services that they do not offer. So they also have to
continue to move quickly to address them, so a risk to be aware of relative to their competition.
For their outlook for Q2 and the remainder of the year, Coinbase’s quarter to date performance
across their four key business metrics are trending to meet or exceed their Q1 results.
And so they are updating full year 2021 forecast scenarios to reflect higher average annual
MTUs levels. They also expect meaningful growth in 2021 from Institutional Revenue,
driven by transaction and custody revenue, based on increasing volumes of institutional onboarding,
increased capital allocations to crypto, and increased trading volumes from existing clients,
despite their institutional revenue being inherently unpredictable.
So some really solid performances from this crypto stock with some very positive financials, a strong
pipeline of catalysts to give coinbase a positive share price target over the coming months.
So if you want to invest in this stock, you want to strike in at a price which you like and that
works for you. So I’ll start by cost averaging in with a stop loss ideally in the range of 5 – 10%.
The share price has been on a steady decline and I don’t think it has bottomed out yet.
So my strike price would be between $220 to $225 per share. So if there’s any further
pull back towards $225 per share, that would be a good entry point for the long term.
So based on their performance and outlook discussed, my bet on coinbase share price target
is, it could hit $500 per share over the next 12 -18month
subject to stable crypto trading volumes But please do your own research.
You need to be aware that despite the positive outlook share price prediction with this stock,
investing in it is still risky and volatile given the current market conditions, so just make sure
you are planning for any trade accordingly and it falls within your risk tolerance..
This video is not a buy or sell recommendation but is meant to bring
some new and exciting stocks to your attention for you to do your own research..
As always I would love to hear from you, so let me know your thoughts on this stock in
the comments section and what crypto stocks are catching your eyes lately.
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