Coinbase is in the throes of a tumultuous cryptocurrency sector, but analysts at Wedbush aren’t especially worried.
The tech-focused investment bank reiterated its ‘outperform’ rating and US$75 price target after Coinbase’s fourth-quarter sales of US$605mln beat market expectations of around US$590mln but the net deficit rose quarter-on-quarter to US$557mln.
The cryptocurrency exchange also said it plans to make additional job cuts, although acknowledging that may actually be a positive in the eyes of analysts.
READ: Coinbase hints at more job cuts as losses soar
“We believe the company's investments in transparency and compliance (since its IPO) will go a long way given the ongoing/expected increased regulatory scrutiny,” Wedbush analysts said.
“Excluding the possibility of a ‘black swan’ event, where regulators completely bar crypto ownership, and assuming regulatory enforcement forces compliance in the areas of transparency (fee), safety (liquidity), and security (privacy, fraud, cyber), we believe COIN is well positioned to survive and succeed.”
Investors, meanwhile, sent shares more than 3% lower to $59.90 on Wednesday morning in New York.
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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