Coinbase stock rebounds towards $210 ahead of the Q1 earnings release

Coinbase will release its Q1 2024 earnings report after the markets close today.

Quick facts (as of 12/31/2023):

• Coinbase – largest cryptocurrency exchange in the United States
   
• Quarterly volume traded – $154 billion
   
• Safeguarded assets – $193 billion
   
• Geographical reach – >100 countries

Since the beginning of the year Coinbase stock is up 20.79% (as of 05/02/2024), outperforming its benchmark index – the NASDAQ Composite, which has posted a 3.95% gain for the same period.

The markets are now expecting Coinbase’s revenue to grow by $70.8%, reaching ~$1.3 billion for the Q1 2024. The estimated earnings per share may reach the positive zone at ~$1.09 (-$0.34 in Q1 2023).

The implied 1-day potential move after the earnings release is 12.35%
 

 

On the positive side …

The company is actively expanding its operations in terms of both geographic presence and product variability.

Over the past year, the company expanded its Coinbase One offering to 38 countries. It also launched operations in Canada & Brazil and received licenses in Singapore, France, Spain and Bermuda.

Coinbase has also introduced its international exchange services to institutional clientele and has already onboarded 100 of these, whose trading volume reached $30 billion in 2023.

However …

Coinbase’s expansion may bring new political and economic risks associated with its operations in the new regions. This could potentially impact the overall performance of the company.

Also, the company’s health is heavily dependent on the overall state of the crypto and its stock is sensitive to Bitcoin and Ethereum (correlations: 0.561, 0.537).

Any turbulence in crypto asset prices or/and trading volume may affect the exchange’s revenue streams.