- An H.C. Wainwright analyst recently initiated a buy rating for Coinbase.
- Mike Colonnese believes the stock has a potential 35% upside.
- Coinbase stock has dropped 35% in the past month.
Coinbase Global Inc has been on a downward spiral in the past month, losing 35% of its value in the same period. However, Mike Colonnese – an analyst from H.C. Wainwright – believes the stock has a potential upside of 35%, recommending investors to buy the world’s second-largest crypto exchange.
Colonnese’s Bullish View on Coinbase
In a research note published on Wednesday, Colonnese explained his bullish view on Coinbase stock, citing the rewards outweigh the risks in the long run. The analyst believes that Coinbase is uniquely positioned to benefit from the large and growing cryptocurrency economy due to its reliable brand, easy-to-use products, and focus on compliance and regulations.
Coinbase has a presence in over 100 countries and serves approximately 8.3 million active users. This scale, according to Colonnese, is enough to expand the firm’s market share this year.
Q1 Results Could Provide Catalyst for Coinbase Stock
The company is expected to announce its Q1 results next week. Analysts are predicting losses of $1.36 per share compared to $1.98 per share in the same quarter a year ago. However, Colonnese believes the crypto winter is over and the resulting increase in trading volume should help Coinbase’s operating performance.
Coinbase is a scarce asset, as the only publicly listed crypto native company in the U.S. with a market cap >$10B, which means competition for investor capital is extremely limited.
The analyst also noted that the resolution of the lawsuit filed by Coinbase against the Securities and Exchange Commission could help drive the stock further up.