Mizuho upgraded Coinbase (COIN) to Neutral from Underperform with a price target of $290, up from $250. The firm’s analysis of bitcoin adoption growth points to further upside in bitcoin price over the medium-term. Bitcoin price and Coinbase shares are highly correlated, the analyst tells investors in a research note. In addition, stablecoins are increasingly seen as a “disruptive force” in payments and U.S. dollar coin’s market capitalization is on an upward trajectory, contends Mizuho. The firm points out stablecoin revenue is 20% of Coinbase’s mix. The company’s Q4 and January volume trends are also pacing well ahead of expectations, according to the analyst. However, Coinbase shares are more expensive than Robinhood (HOOD), and its retail take rates “remain rich,” which could lead to price compression over time, Mizuho says, explaining why it didn’t upgrade the stock to Outperform. Further, the more friendly regulatory environment under President Trump and the presence of bitcoin exchange traded funds may increase Coinbase’s competition, the firm notes.
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