By Senad Karaahmetovic
Cowen analyst Stephen Glagola started research coverage on Coinbase (NASDAQ:COIN) with an Outperform rating and an $85.00 per share price target.
The US-based crypto exchange is seen as a “dominant player in the States with a burgeoning subscription & services platform we believe can grow at a +DD% CAGR for the foreseeable future”.
“With 88% of TTM net revenues from transaction fees it charges retail users, we expect COIN to be primarily an exchange/retail brokerage-driven story over the next several years. We estimate COIN has a dominant ~46% share of total U.S. regulated centralized exchange spot volume as of 2021, up from 39% in 2020; increasing market share y/y despite concerns over rising competition. In our view, current industry structure suggests that risk of n-t fee compression is low given these platforms also compete on security/trust of platform access to assets, ease of use, customer support, and alt. products (staking, NFTs, defi, etc.),” Glagola told clients in a note.
The price target is based on the 12x multiple as the analyst opted to take “a more conservative view on macroeconomic uncertainty and crypto volatility over the next 12 months.”
Coinbase shares are down nearly 5% in pre-open today.