BTIG Sticks With Buy on Coinbase Despite 40% Discount

BTIG Research has reaffirmed its Buy rating and $240 price target for Coinbase (COIN), despite the stock trading about 40% below that level. Analyst Andrew Harte made this call after meeting with Brett Tejpaul, Co-CEO of Coinbase Institutional, who outlined a three-phase strategy for the company's institutional arm.

Phase one focuses on building out a core platform, while phase two expands into payment services and stablecoins. The third and final stage ventures into tokenized assets and continuous markets. Currently, the institutional segment accounts for around 20% of Coinbase's total revenue, which stood at $6.04 billion with an 85.8% gross margin in the last twelve months.

Harte previously lowered the price target from $260 to $240 on July 31 due to a tough second quarter marked by a 25% decline in crypto spot trading volumes. However, BTIG believed that much of this weakness had already been factored into market expectations and pointed out ongoing market-share gains and platform diversification as reasons to remain optimistic.