COIN - Coinbase: Strong Potential But Valuation Is Too Hot

2024-06-11 10:38:32 ET

Summary

• Coinbase is by far the largest crypto exchange in the U.S., which makes it uniquely positioned to benefit from the secular shift to crypto.
• The company's financial performance is heavily influenced by the volatility of Bitcoin's price, but it is succeeding in building a more stable business based on subscriptions.
• The stock is currently trading at a 40% premium, suggesting limited upside potential. It is recommended to hold off on buying at this price.

My thesis

Everyone speaks about artificial intelligence ((AI)), and it seems that all other big secular shifts are undeservedly ignored. The crypto revolution is one of such trends and Coinbase ( COIN ) is one of the most important companies within the shift. There are several reasons to believe that COIN is one of the companies with strong potential to grow....

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