What To Expect From Coinbase Today

PARIS, FRANCE – APRIL 13: In this photo illustration, a visual representation of the digital … [+] cryptocurrency Bitcoin is displayed in front of the Coinbase cryptocurrency exchange platform logo on April 14, 2021 in Paris, France. Coinbase, America’s leading cryptocurrency exchange, arrives on Wall Street on Wednesday April 14 as part of a ‘direct introduction’. An IPO, eagerly awaited by crypto enthusiasts, which could value the Californian company at more than 100 billion dollars. This is the most anticipated event on Wall Street since Facebook came public: the Coinbase platform, specializing in cryptocurrencies, entered the Nasdaq at a price of $ 250 per share. It’s the biggest introduction for an American business since Uber in 2019.Taking advantage of exploding demand for digital currencies, Coinbase said last week that it expects to make a profit of $730 million to $800 million in the first quarter of 2021, more than double the total profit in 2020. Revenues for the first three months of 2021 have likely exceeded last year’s, to nearly $1.8 billion. (Photo illustration by Chesnot/Getty Images)

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Coinbase Global Inc. is scheduled to report earnings after Tuesday’s close. The stock just hit a record high of $429.59/share when it came public in April 2021 and is currently trading near $267/share. The stock is prone to big moves after reporting earnings and can easily gap up if the numbers are strong. Conversely, if the numbers disappoint, the stock can easily gap down. To help you prepare, here is what the Street is expecting:

Earnings Preview:

The company is expected to report earnings of $2.26/share on $1.71 billion in revenue. Meanwhile, the so-called Whisper number is a gain of $2.40/share. The Whisper number is the Street’s unofficial view on earnings.

Charts Courtesy MarketSmith Incorporated

A Closer Look At The Fundamentals:

The company turned profitable in 2020 and has enjoyed thunderous earnings and sales growth in recent quarters! Typically, it is healthy to see a company grow its earnings by over 20% in a quarter compared to the same quarter in the prior year. If earnings grow by over 30-50% that is very strong. If a company manages to post 100-200% growth that is an outlier. Well, the company has managed to grow its earnings by over 700% in each of the three past quarters compared to the same period in the prior year! That is explosive growth as demand for crypto has soared!

A Closer Look At The Technicals:

Technically, the stock is trying to bottom and has rallied nicely in recent weeks. The stock started trading in April 2021 and then fell hard as a slew of crypto currencies plunged. Then, as crypto’s bottomed over recent months and began breaking out, the stock followed suit. The stock is well positioned to rally as more and more people continue piling into crypto.

Pay Attention To How The Stock Reacts To The News:

From where I sit, the most important trait I look for during earnings season is how the market and a specific company reacts to the news. Remember, always keep your losses small and never argue with the tape.