Shares of Coinbase Global (NASDAQ: COIN) surged on Friday, adding as much as 6.1%. As of 12:12 p.m. ET, the stock was still up 5.8%.
The catalyst that drove the crypto trading specialist higher was some positive commentary courtesy of a couple of Wall Street analysts.
Piper Sandler (NYSE: PIPR) analyst Richard Repetto believes that the recent pullback in Coinbase Global stock provides investors with an attractive entry price, while giving them exposure to the fast-growing digital asset and cryptocurrency space.
He noted that adoption continues at a rapid pace and Coinbase is positioned to be a consumer "on ramp" for anything related to cryptocurrency and digital assets. While Coinbase Global is currently closely correlated to the price movements of Bitcoin and other cryptocurrencies, he suggests that as the company works to diversify its revenue streams, it will be less influenced by the volatile price movements of the crypto market.
Perhaps more importantly, Repetto named Coinbase as a "top pick," assigning an overweight (buy) rating and a $440 price target. This represents potential gains for investors of roughly 159%, compared to Thursday's closing price.
Another Wall Street analyst provided a slightly different take. Earlier this week, Mizuho analyst Dan Dolev lowered his price target on the stock, from $300 down to $220, while maintaining a neutral (hold) rating on the shares.
At the same time, however, Dolev posits that payment-related stocks "could rebound sharply" in the back half of 2022. Given the uneven pandemic-related comps, he believes growth compared to 2019 is likely to remain positive. Additionally, after reviewing nearly 50 such stocks, he found that Coinbase Global was tracking the sector's two-year growth closely.
Investors should keep in mind that Coinbase Global's prospects are heavily tied to the continuing adoption of cryptocurrency. Given the nature of these digital assets and uncertain future path, investors should be sure they have a sufficiently long time horizon, as well as a stomach for volatility.
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