Coinbase Global COIN is slated to report third-quarter 2021 results on Nov 9, before the opening bell. The company delivered a negative earnings surprise of 157.83% in the last- reported quarter.
Let’s see how things have shaped up prior to the announcement.
The third-quarter results are likely to benefit from the increased adoption of a greater number of crypto assets, and increased volatility coupled with increased interest across the entire cryptoeconomy. Retail, institutional and ecosystem partners are likely to have grown across all key metrics including Verified Users, retail Monthly Transacting Users (MTUs), Trading Volume, and Assets on Platform.
Increase in institutional interest, launch of Ethereum 2.0 staking products in April 2021, and growth in DeFi and NFT are likely to have aided Ethereum trading volume growth.
Retail transaction revenues are expected to have benefited from both increase in MTUs and elevated trading volumes per MTU.
Improved transactional revenues along with subscription and services revenues are likely to have aided revenues in the to-be-reported quarter. The Zacks Consensus Estimate for revenues is pegged at $1.6 billion for the third quarter.
The company noted strong crypto price cycle with high prices of many crypto assets, high levels of volatility, and high interest in crypto across retail and institutional users in the third quarter.
However, increased competition is likely to have been an overhang. Operating expense is likely to have increased, given higher trading volumes, account verification fees, payment processing fees and digital advertising spend.
What the Zacks Model Says
Our proven model does not conclusively predict an earnings beat for Coinbase Global this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case as you can see below.
Earnings ESP: Coinbase Global has an Earnings ESP of -21.00%. This is because the Most Accurate Estimate of $1.42 is pegged lower than the Zacks Consensus Estimate $1.79. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Coinbase Global, Inc. Price and EPS Surprise
Zacks Rank: Coinbase Global currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks from the same space that beat the respective Zacks Consensus Estimate for third-quarter 2021 earnings are as follows:
CME Group CME beat the consensus estimate by 3.2%
Nasdaq NDAQ beat the consensus estimate by 3.5%
Cboe Global CBOE beat the consensus estimate by 1.4%
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