JMP Securities maintained its Market Outperform rating on Coinbase (NASDAQ:COIN) in a note Friday, stating they see "many of the same attributes in the firm's story and mentality as were present in Amazon decades ago."
Analysts, who have a $200 per share price target on the stock, provided several factors for their bullish view of the stock, including the Spot Bitcoin ETF being bullish for the company.
Furthermore, the firm believes higher retail trading spreads today are not an immediate threat to Coinbase.
"Just like in stock trading, we believe execution costs will come down with volumes expanding, and we note that customers also place value on the holistic platform beyond just price," the analysts said.
"Industry survivors to date have done something right, and today's leaders will thrive long term, even if not evident in a depressed backdrop," the analysts added.
They explained that the market often struggles to predict and model innovation, "but firms with deep experience and technical differentiation have an edge skating to where the puck is going, finding new avenues of revenue growth and diversification," just as Amazon executed on over the past two decades.
"Coinbase is still quite early into its journey, but we see many of the same attributes in the firm’s story and mentality as were present in Amazon decades ago," the analysts stated. "We believe Coinbase has the potential to become one of the few network winners in an industry we expect to grow exponentially from here."