Coinbase surges 37% as BTC pumps and analysts tip strong Q4 results
Shares in crypto exchange Coinbase have gained 37% over the past week alongside a recent surge in Bitcoin ( BTC ) and while analysts expect strong numbers when the firm reports its fourth-quarter results on Thursday.
According to aggregated data from MarketWatch and FactSet, analyst consensus is tipping a strong revenue boost for Coinbase in the fourth quarter, increasing by around 22% from the third quarter to $825 million.
Some of this is predicted to come from strong trading volumes, with analysts estimating a near doubling from $76 billion in Q3 to $142.7 billion in Q4.
Estimates also pin Coinbase to report a fourth-quarter earnings-per-share of $0.02, a swing up from its previously reported loss of $0.01 per share in the third quarter.
$COIN Earning is tomorrow, everyone including myself is trying to estimate as close as possible. So we zoomed in and tracking volume, asset price and etc.
— CBduck ️ (@CoinbaseDuck) February 14, 2024
I think it’s good time to step back and look at how Coinbase has evolved from 2021 to 2023 pic.twitter.com/VN4pCyh5p8
It comes as the price of Bitcoin has increased 16.3% in the past seven days, according to data from Coinmarketcap.
On Feb. 13, competitor trading platform Robinhood posted an overall revenue increase in the fourth quarter, also due to a jump in crypto trading revenue.
Robinhood’s Q4 revenue was up 24% year-on-year, supported by $43 million in crypto trading revenue which gained 10% year-on-year.
However, not everyone is convinced that Coinbase will be able to continue gaining steam in 2024.
In a Jan. 22 note to investors, JPMorgan analysts pegged the share price of Coinbase to fall in 2024, pinning their expectations of Coinbase’s poor performance on an “underwhelming” start to spot Bitcoin ETFs trading.
However, while spot Bitcoin ETFs witnessed a bumpy first few weeks, dragged down by the nearly $6 billion that poured out of Grayscale’s newly converted GBTC fund between Jan. 11 and Feb. 2, net inflows have picked up significantly over the past few days.
Bitcoin ETF flows have picked up significantly in the past few days. Source: FarSideOn Feb. 13, BlackRock’s IBIT generated a whopping $493 million worth of inflows, while all 10 ETFs witnessed a total of $631 million in net inflows on the day.
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Coinbase acts as the custodian for eight out of 10 spot Bitcoin ETF providers, including BlackRock, iShares, and Valkyrie.
Another key sticking point for Coinbases’ is its ongoing lawsuit with the United States Securities and Exchange Commission.
Speaking to Cointelegraph Magazine, crypto lawyer James Murphy, also known as “MetaLawMan” on X, says he’s confident the SEC will lose its case against Coinbase.
“Coinbase is going to win their case. I believe the SEC is wrong. They’ve gone too far in trying to make the case that the tokens on the secondary market are investment contracts when that is not correct.”
Coinbase was sued by the SEC in June 2023, accusing the crypto exchange of disobeying its rules and selling unregistered securities.
Coinbase's share price over 24 hours. Source: Google FinanceCoinbase shares are currently up 14% on the day, with the prices of many publicly traded crypto companies being buoyed by a wider rally in the crypto sector , which saw Bitcoin (BTC) surge above $50,000 on Feb. 13.
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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