JPMorgan Chase raised its price target on Coinbase (NASDAQ:COIN) stock after the cryptocurrency market maker had what was termed a “blowout” first quarter.
Coinbase earned $1.175 billion, $4.84 per share fully diluted, on revenue of $1.637 billion for the three months ending in March. JPMorgan bumped its target price on the stock to $171 per share.
Coinbase, however, opened this morning at $226 per share, its market capitalization slightly below $56 billion. Shares are now up 31% on the year but remain 38% below their November 2021 peak.
Big ETF Days
The profit was only Coinbase’s second since the boom times of late 2021. It was credited to the rise of crypto exchange-traded funds (ETFs). These new products helped send trading volume for major coins up 68% from a year ago, according to Coinmarketcap, which tracks cryptocurrency value.
Since the start of 2024, Bitcoin (BTC-USD) is up 37% and Ethereum (ETH-USD) is up 29%.
There are now dozens of Bitcoin ETFs. The best known are the Grayscale Bitcoin Trust (NYSEMKT:GBTC), with assets of over $21 billion, and the Blackrock (NYSE:BLK) iShares Bitcoin ETF (NASDAQ:IBIT), with assets of over $2 billion.
Coinbase said its transaction revenue for the quarter came to $935 million, over twice that of a year ago. Total transaction revenue tripled to $1.08 billion.
Why, then, did COIN stock fall after earnings?
Analysts blamed the 9% advance of May 2 and falling Bitcoin prices. Bitcoin is down 6% on the week at about $60,500 per coin. Coinbase’s Chief Financial Officer, Alesia Hobbs, says COIN’s stock price reflects broad sentiment on the cryptocurrency market more than Coinbase’s performance.
Crypto bulls are now looking to see Coinbase offer futures in other alt-coins like Arweave (AR-USD), Hedera (HBAR-USD) and Theta Network (THETA-USD). While the rules of Bitcoin are fairly well known, those of alt-coins deserve careful analysis before investing.
COIN Stock: What Happens Next?
Bitcoin can sometimes be seen as a measure of the market’s animal spirits and willingness to take risks. With markets expected to rise May 3 on weak employment data, it should be a good day for Bitcoin traders.
On the date of publication, Dana Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
