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Coinbase Global Inc Ordinary Shares - Class A - Stock Quote COIN

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Morningstar's Coinbase Global Inc Ordinary Shares - Class A Stock Analysis

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Coinbase Falls From Grace in Q1 as Falling Revenue Meets Rapidly Increasing Costs; FVE to $131

Michael Miller Equity Analyst

Analyst Note

| Michael Miller |

Low trading volume and much higher expenses led no-moat Coinbase to report a net loss of $1.98 per share for the first quarter. As we incorporate these results, we are reducing our fair value estimate to $131 per share from $210 as the firm now requires substantially higher levels of cryptocurrency trading volume to generate a profit. A higher breakeven point effectively increases Coinbase's already high leverage to volatile cryptocurrency market conditions. Cryptocurrency markets are highly unpredictable, and Coinbase has said it is willing to lose up to $500 million in EBITDA per year, making the timing for a return to positive earnings unclear.

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Coinbase Global Inc Ordinary Shares - Class A's Company Profile

Business Description

Founded in 2012, Coinbase is the leading cryptocurrency exchange platform in the United States. The company intends to be the safe and regulation-compliant point of entry for retail investors and institutions into the cryptocurrency economy. Users can establish an account directly with the firm, instead of using an intermediary, and many choose to allow Coinbase to act as a custodian for their cryptocurrency, giving the company breadth beyond that of a traditional financial exchange. While the company still generates the majority of its revenue from transaction fees charged to its retail customers, Coinbase uses internal investment and acquisitions to expand into adjacent businesses, such as prime brokerage, data analytics, and collateralized lending.

Contact
c/o The Corporation Trust Company, 1209 Orange Street
Wilmington, DE, 19801
T +1 302 777-0200
Sector Technology
Industry Software - Application
Most Recent Earnings Mar 31, 2022
Fiscal Year End Dec 31, 2022
Stock Type
Employees 3,730

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