Just days before Coinbase reveals its Q2 earnings, Citi slashed its price target by 41%, dropping it from $400 to $235, yet surprisingly kept its buy rating intact. This split stance highlights Wall Street's cautious but still optimistic view on the crypto exchange.
Citi analyst Peter Christiansen pointed to declining spot trading volumes, expected to hit a two-year low this quarter, as the main reason for the downgrade. The market has already been bracing for weakness after Coinbase missed revenue targets last quarter and saw its stock fall nearly 29% year-to-date.
Other firms echoed this sentiment, with Clear Street lowering its target to $225 and Rosenblatt holding steady at $240, close to Citi’s revised projection. Analysts anticipate revenue around $1.3 billion, a 13% drop from last year and below the $1.41 billion posted last quarter. Barclays estimates Coinbase’s trading volume at $152 billion this quarter, short of the $178 billion Wall Street expected.
Steady Revenue Streams Offer Some Stability
Despite the slump in trading, Coinbase’s subscription and services income including interest from the USDC stablecoin it helps manage provides a steadier revenue base. This has helped the stock bounce back over 5% in the past month, even as crypto trading slows industry-wide.
All eyes now turn to upcoming U.S. crypto legislation that could drastically reshape the market landscape, potentially impacting Coinbase’s future growth.
