We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Zacks Investment Ideas feature highlights: Coinbase Global and BlackRock
Read MoreHide Full Article
For Immediate Release
Chicago, IL – November 3, 2023 – Today, Zacks Investment Ideas feature highlights Coinbase Global (COIN - Free Report) and BlackRock (BLK - Free Report) .
EPS Preview: Unraveling Coinbase's Early Puzzle
Zacks Rank #3 (Hold) stock Coinbase Global is expected to report earnings Thursday after the market close. Coinbase is the largest and most popular cryptocurrency exchange in the US. The platform allows users to buy, sell, and store cryptocurrencies like Bitcoin, Ethereum, and Ripple. Zacks Consensus Analyst Estimates forecast that the company will lose $0.54 for the quarter. Last year, Coinbase reported EPS of -$2.43 for the same quarter.
Spotty But Improving Earnings Surprise History
Coinbase went public in 2021 and has ten quarters of earnings history. Though COIN's earnings history is brief, thus far, it paints a mixed but improving picture. COIN has missed Zacks Consensus Estimates in six of ten quarters. However, the past two quarters have been solid. In May, COIN beat estimates by delivering a 110% EPS surprise, and last quarter, it trounced forecasts by 46%.
5 Things to Watch
SEC Lawsuit
The biggest cloud surrounding Coinbase is its ongoing battle with the US Securities and Exchange Commission. In June, the SEC charged Coinbase with operating a crypto asset trading platform as an unregistered securities exchange. Despite the obvious uncertainty the lawsuit creates for investors, Coinbase shares are much higher than when the SEC lawsuit was filed on June 6th. A plethora of recent crypto industry legal victories is likely spurring investor confidence. Watch to see if Coinbase management has any updates on its ongoing legal battle.
Forward Guidance
Coinbase is very likely to report a loss for the quarter. However, Wall Street is forward-looking. Watch to see if Coinbase's positive earnings trajectory is expected to continue.
Bitcoin Halving
The next Bitcoin Halving will occur in the first half of 2024. When a halving occurs, the reward for mining new blocks is halved, making it more challenging for miners to earn net Bitcoins. Historically, this event has led to increased scarcity and has driven up the value of Bitcoin due to reduced supply. Because Coinbase's business is deeply intertwined with the world's most popular cryptocurrency, the halving is a potential bullish catalyst for COIN shares.
Institutional Adoption Commentary: Slowly, Then All at Once
For most of its history, small retail investors have comprised most of the investment in the crypto industry. However, Bitcoin has stood the test of time and is garnering attention from the world's largest asset managers, such as BlackRock. If Bitcoin ETFs are to be approved (I expect them to be), Coinbase will benefit dramatically because it is the listed exchange for most of the Bitcoin ETF filings.
Furthermore, COIN CEO Brian Armstrong divulged in an interview that deep-pocketed sovereign wealth funds have already begun to allocate assets to crypto. While adoption is already in motion, the floodgates will swing open if the crypto industry gets long-awaited regulatory clarity from regulators.
Coinbase Is a Cash Cow
Value investing legend Seth Klarman shocked Wall Street when he invested in Coinbase. Though Klarman is far from a crypto proponent, he explained that he bought shares because "Coinbase is sitting on $5 billion in cash, has less than that in debt, and is doing some smart things." Though Coinbase is losing money, its growing cash hoard should attract new investment dollars from investors who would otherwise avoid the crypto industry.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Zacks Investment Ideas feature highlights: Coinbase Global and BlackRock
For Immediate Release
Chicago, IL – November 3, 2023 – Today, Zacks Investment Ideas feature highlights Coinbase Global (COIN - Free Report) and BlackRock (BLK - Free Report) .
EPS Preview: Unraveling Coinbase's Early Puzzle
Zacks Rank #3 (Hold) stock Coinbase Global is expected to report earnings Thursday after the market close. Coinbase is the largest and most popular cryptocurrency exchange in the US. The platform allows users to buy, sell, and store cryptocurrencies like Bitcoin, Ethereum, and Ripple. Zacks Consensus Analyst Estimates forecast that the company will lose $0.54 for the quarter. Last year, Coinbase reported EPS of -$2.43 for the same quarter.
Spotty But Improving Earnings Surprise History
Coinbase went public in 2021 and has ten quarters of earnings history. Though COIN's earnings history is brief, thus far, it paints a mixed but improving picture. COIN has missed Zacks Consensus Estimates in six of ten quarters. However, the past two quarters have been solid. In May, COIN beat estimates by delivering a 110% EPS surprise, and last quarter, it trounced forecasts by 46%.
5 Things to Watch
SEC Lawsuit
The biggest cloud surrounding Coinbase is its ongoing battle with the US Securities and Exchange Commission. In June, the SEC charged Coinbase with operating a crypto asset trading platform as an unregistered securities exchange. Despite the obvious uncertainty the lawsuit creates for investors, Coinbase shares are much higher than when the SEC lawsuit was filed on June 6th. A plethora of recent crypto industry legal victories is likely spurring investor confidence. Watch to see if Coinbase management has any updates on its ongoing legal battle.
Forward Guidance
Coinbase is very likely to report a loss for the quarter. However, Wall Street is forward-looking. Watch to see if Coinbase's positive earnings trajectory is expected to continue.
Bitcoin Halving
The next Bitcoin Halving will occur in the first half of 2024. When a halving occurs, the reward for mining new blocks is halved, making it more challenging for miners to earn net Bitcoins. Historically, this event has led to increased scarcity and has driven up the value of Bitcoin due to reduced supply. Because Coinbase's business is deeply intertwined with the world's most popular cryptocurrency, the halving is a potential bullish catalyst for COIN shares.
Institutional Adoption Commentary: Slowly, Then All at Once
For most of its history, small retail investors have comprised most of the investment in the crypto industry. However, Bitcoin has stood the test of time and is garnering attention from the world's largest asset managers, such as BlackRock. If Bitcoin ETFs are to be approved (I expect them to be), Coinbase will benefit dramatically because it is the listed exchange for most of the Bitcoin ETF filings.
Furthermore, COIN CEO Brian Armstrong divulged in an interview that deep-pocketed sovereign wealth funds have already begun to allocate assets to crypto. While adoption is already in motion, the floodgates will swing open if the crypto industry gets long-awaited regulatory clarity from regulators.
Coinbase Is a Cash Cow
Value investing legend Seth Klarman shocked Wall Street when he invested in Coinbase. Though Klarman is far from a crypto proponent, he explained that he bought shares because "Coinbase is sitting on $5 billion in cash, has less than that in debt, and is doing some smart things." Though Coinbase is losing money, its growing cash hoard should attract new investment dollars from investors who would otherwise avoid the crypto industry.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
See Stocks Free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.