Morgan Stanley Sees 40% Upside in Coinbase Amid Diversified Growth

Morgan Stanley initiated coverage of Coinbase with an 'Equal Weight' rating and a $250 price target, suggesting a potential upside of over 40% from current levels. Analyst Michael Cyprys noted that Coinbase has diversified its services beyond cryptocurrency trading, now offering retail and institutional trading, custody, stablecoins, derivatives, staking, payments, and onchain infrastructure.

Cyprys highlighted the company's growth, with 7.6 million monthly transacting users and $246 billion of assets on the platform as of the second quarter. However, he also warned that retail crypto trading remains a key swing factor in revenue, accounting for about 40% of it.

The analyst forecasts a cyclical reset in 2026, followed by a sharp rebound in 2027 and normalization in 2028, when adjusted EBITDA is expected to reach around $3.0 billion. The price target is based on 21 times this estimate, in line with Coinbase's historical average and the digital-asset peer median.