Investing.com — Goldman Sachs (NYSE:GS) assumed coverage of Coinbase Global (NASDAQ:COIN) shares with a Neutral rating and a price target of $195, implying a slight upside from the current levels.
The bank’s analysts said they are “cautiously optimistic” on Coinbase shares, but highlight “a balance of upside and downside risks.”
They acknowledged the company’s potential for growth driven by higher cryptocurrency prices since 2023 and possible regulatory reforms in the U.S. that could spur wider crypto adoption.
At the same time, there are risks, such as a roughly 15% decline in cryptocurrency prices year-to-date that could undermine Coinbase’s recent growth.
Longer-term, Goldman points out that regulatory changes could invite more competition in the financial services sector, potentially impacting Coinbase’s market share and pricing.
“We expect sustainable profitability and margins remaining close to those of its peers over time,” analysts led by James Yaro said in a note.
Revenue and adjusted earnings growth are projected at 11% and -2% per annum, respectively, from 2024 to 2027, compared to 8% and 5% growth for peers in the exchange, broker, and fintech sectors.
The analysts also expect Coinbase’s revenue per asset to increase by about 10% from 2024 to 2027, mirroring the trend between 2022 and 2024.
Goldman Sachs’ estimates for Coinbase’s 2025-2027 revenue are 2-3% below the Visible Alpha consensus, which the firm attributes to the lagging impact of lower crypto prices on forecasts.
Coinbase shares are trading close to the peer mean P/E across exchanges, brokers, and fintechs, which the Wall Street firm believes “is close to fair value, given our balanced outlook, and modest forecasted downside to earnings.”
