Is the Coinbase stock price too cheap ahead of earnings?

The Coinbase (NASDAQ: COIN) stock price sell-off continued as the broader stock and cryptocurrencies sell-off continued. The stock fell to an all-time low of $84, which was about 80% below its all-time high, bringing its total market cap to about $18 billion. At its peak, the company had a market value of more than $70 billion.

Cryptocurrency sell-off

Coinbase is a leading cryptocurrency that has more than 90 million customers from around the world. The firm handles billions of dollars worth of cryptocurrencies every day.


Are you looking for fast-news, hot-tips and market analysis?

Sign-up for the Invezz newsletter, today.

Coinbase, like all other companies in the industry, make more money when the cryptocurrency industry is doing well. When digital coins are doing well, it usually leads to more users as people take advantage of the rising prices.

But cryptocurrencies are not doing well. Bitcoin has declined to about $31,000 while the total market cap of all digital coins has dropped to about $1.56 trillion. At their peak, the total value of cryptocurrencies was over $3 trillion. 

Analysts now expect that the number of active users in the platform crashes. Therefore, analysts will be paying a close attention to trading volume and active users when the company publishes its quarterly results on Tuesday.

In its most recent quarterly earnings, Coinbase said that its platform had over 11.4 million users. That was significantly higher than where it was a year earlier. 

Analysts expect that Coinbase revenue declined to $1.48 billion in the first quarter after it rose to $2.5 billion in the previous quarter. They also expect that the EPS dropped to $0.86, which will represent a -71.8% year-on-year decline.

The other key thing to watch will be the company’s new non-fungible token (NFT) marketplace. Also, investors will want to hear about the firm’s acquisition of 2TM and BtcTurk.

Coinbase stock price forecast

coinbase stock

The daily chart shows that the Coinbase stock price has been in a strong bearish trend in the past few months. The sell-off continued when the stock moved below the important support level at $209, which was the lowest level in May last year. It also moved below the key level at $150, which was the lowest point on March 16th. 

The stock has moved below the 25-day and 50-day moving averages. Therefore, regardless of the company’s results, there is a likelihood that the stock will keep falling to about $50.

Where to buy right now

To invest simply and easily, users need a low-fee broker with a track record of reliability. The following brokers are highly rated, recognised worldwide, and safe to use:

  1. Etoro, trusted by over 13m users worldwide. Register here >
  2. bitFlyer, simple, easy to use and regulated. Register here >

*Cryptoasset investing is unregulated in some EU countries and the UK. No consumer protection. Your capital is at risk.

Source: https://invezz.com/news/2022/05/09/is-the-coinbase-stock-price-too-cheap-ahead-of-earnings/