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Coinbase Global Inc’s Stocks on the Rise: Is the Momentum Just Getting Started?

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Written by Timothy Sykes Reviewed by Jack Kellogg Fact-checked by Ellis Hobbs
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Coinbase Global Inc’s recent market uptick is influenced by heightened attention and positive sentiment surrounding major developments in the cryptocurrency sector, drawing investor interest and boosting its performance. On Friday, Coinbase Global Inc’s stocks have been trading up by 7.4 percent.

What’s Fueling COIN’s Rise?

  • Under the Democratic presidential nominee spotlight, promises of bolstered AI and cryptocurrency investments suggest a bright future. Kamala Harris’ backing of the digital asset sphere might usher in a robust environment for Coinbase.

Candlestick Chart

Live Update at 13:33:21 EST: On Friday, October 11, 2024 Coinbase Global Inc stock [NASDAQ: COIN] is trending up by 7.4%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

  • Despite softer volumes, Barclays remains optimistic, adjusting their price target on COIN to $175, hinting at potential regulatory changes that could benefit COIN.

  • Major cryptocurrencies shine with Bitcoin surpassing $63,000, reflecting a bullish digital asset market. As a positive wave hits the crypto sector, companies with crypto interests, such as Coinbase, are poised to gain.

  • A noteworthy surge in digital currencies, with Bitcoin at $65,000, brings an optimistic outlook for the firm. This demonstrates a resilient market presence beneficial to stakeholders like Coinbase.

  • The impressive movement within major cryptocurrencies, namely Bitcoin and Ethereum, boosts the digital currency domain. Coinbase, as a notable crypto-exposed company, stands to capitalize on this rally.

Cryptocurrency Boom and COIN’s Position

As digital currencies soar, Coinbase is finding itself in a lucrative position. Bitcoin, the flagship currency, teeters above its previous peaks at astonishing rates. As if taking inspiration from those energetic dancefloor flicks from the ’90s, Bitcoin shot past $63,000 leaving investors in high spirits.

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But wait, it doesn’t stop at Bitcoin. The entire crypto ark—Ethereum, Ripple, and the likes—appears to ride similar waves. It’s like a digital dawn for the assets, lifting companies like Coinbase through buoyant clouds. In parallel, significant growth in the financial indices, the Nasdaq, and others, echo this progressive change. More remarkably, they react enthusiastically to the sprinting cryptocurrencies, as if these currencies hold the elixir to market vivacity.

Quick Look at Coinbase’s Financial Pulse

Coinbase’s latest earnings report unveils some intriguing numbers. The company recorded revenues north of $3B. But here’s a twist—while their profit margin hovers around 16.1%, indicating some solid bookkeeping, their EBIT margin, quite frankly, leaves a little more to be desired, standing at just over 3%.

Now picture this—the investing world peeking at Coinbase through its ratio glasses. It turns out, the P/E ratio sits gingerly at 27.52, whispering hints about how investors gauge Coinbase’s future pocket potential. Interestingly enough, the total debt-to-equity ratio reads 0.51, a digit that paints a reasonably robust financial stance.

Oh, and here’s something to chew on—Coinbase maintains a tangible book value per share close to $34. A beacon of what the company is financially worth when dissected to its bare skeleton of assets versus liabilities.

Unpacking Financial Reports and Key Insights

Delve into their reports, and you’ll find a net income from continuous operations lingering at a modest $36.15M. Meanwhile, their operating cash flows boast numbers like a flowy stream—over $484M—and that’s a fiscal splatter of green that anchors them against many economic ripples.

In another corner of the finance room lies the depreciation expense, with a hum of $34.5M. This speaks to how assets soften in value over time, whispering tales of wear and historic trends.

It’s a fascinating juxtaposition; their free cash flow gushes out near $484M strengthening their liquidity profile—a robust counterweight against adversities.

Debt brims at the $4.22B mark, sticking out like a mottled feather in their financial plumage. But amidst it rides a business that’s tactfully rolling its operating gears, leveraging capital with strategic finesse.

The Cryptocurrency Market Sways and COIN’s Movements

Coinbase, much like a ship at sea, rides the tides of cryptocurrency highs. An optimistic sentiment pervades this arena as Bitcoin, much like an Olympic sprinter, flashes past hurdles of resistance. Coinbase, known for its pivotal role in the crypto exchange sphere, finds this digital upswing as a force, funneling positive energy and potentially affecting its stock ripple.

Amid the roaring applause for cryptocurrencies, Coinbase isn’t just basking in reflected glory; it’s strategically positioned to capitalize on rising demands for digital trading avenues. Perhaps an incantation of future gains lies in Kamala Harris’ pro-crypto initiatives—signaling tailoring regulatory backdrops to boost firms like Coinbase.

Still, the road isn’t entirely smooth. The market air carries notes of potential policy overhauls, offering both challenges and golden opportunities. For COIN, riding this wave could mean unlocking their treasure chest of latent potential.

Conclusion

As the data closes, COIN embraces an optimistic future. The tides are in favor of cryptocurrency, harboring potential growth. Regulations loom as both shepherds and wolves, promising investment-friendly skies while suspecting abrupt clouds. In essence, Coinbase stands at a crossroads, optimistic with its sails up, ready to navigate the exhilarating waves of the cryptocurrency zeitgeist.

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

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Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”