JPMorgan Sets Hold Target for Coinbase Shares

JPMorgan Maintains Neutral Stance on Coinbase Shares

JPMorgan analysts have taken a neutral position on Coinbase Inc.’s shares (COIN), refraining from recommending buying or selling to clients. The experts have set a price target of $196 by December 2025, despite Coinbase’s third-quarter earnings falling short of market expectations.

Coinbase’s Resilience Amid Bearish Earnings

Coinbase’s third-quarter results showcased a mixed performance, reporting $75 million in net income. While this amount exceeds the previous year’s figure, it fell short of the $112.2 million analysts had anticipated. Furthermore, net revenue declined from $1.38 billion in the previous quarter to $1.13 billion this quarter, reflecting the volatility in the crypto market.

Despite these challenges, Coinbase remains resilient and adaptable in a rapidly changing industry. A significant move came with the announcement of a $1 billion share buyback program, authorized by the board of directors. This initiative highlights Coinbase’s commitment to enhancing shareholder value while navigating the complexities of the crypto landscape.

Analysts Highlight Coinbase’s Innovative Strides

JPMorgan analysts, including Kenneth B. Worthington and his team, are looking beyond Coinbase’s immediate setbacks. They emphasize the company’s active efforts to enhance its business model through innovation.

• Exploring avenues like its Layer-2 solution, Base, which has over $2.7 billion in Total Value Locked (TVL).
• Implementing stablecoins and improved wallet features.
• Executing effective cost-cutting measures for a more sustainable business model.

The analysts express cautious optimism about the U.S. regulatory environment, noting a potential shift towards more favorable crypto regulations that could benefit the broader market.

JPMorgan’s Long-Term Growth Perspective

JPMorgan’s $196 price target for Coinbase is based on a methodology called “normalized earnings.” They estimate that Coinbase could earn approximately $4.91 per share under stable market conditions, applying a 40x multiple to these earnings to align the valuation with other high-growth financial firms.

Currently, Coinbase’s stock is priced at $180.63, reflecting a 0.77% increase in the last 24 hours. Although the stock recently traded above $200 before the earnings report, this approach underscores JPMorgan’s belief in Coinbase’s long-term growth potential despite recent earnings challenges.