Stock analysts raised price targets on Coinbase and Robinhood after the exchanges crushed expectations during fourth-quarter earnings calls, according to equity research notes shared with Cointelegraph.
Soaring crypto trading volumes in the last three months of 2024 drove higher-than-expected revenues and profits for Coinbase and Robinhood — which is best known as a stock trading platform but is investing heavily in crypto.
In Q4, Coinbase posted its strongest quarter of earnings in over a year as crypto prices and trading surged after the election of US President Donald Trump. Robinhood’s Q4 profits beat consensus estimates, with crypto revenue jumping 700% year-on-year.
“The fourth quarter, and we would argue 2024 overall, was a pivotal and consequential period for the crypto ecosystem — market caps exploded, volumes jumped, new participants entered the market, and regulatory confidence completely flipped,” analysts for JPMorgan wrote in a Feb. 14 research note shared with Cointelegraph.
The surge in crypto trading was “fueled by renewed market optimism post-U.S. election,” crypto researcher Coin Metrics said on Feb. 11. Trump has promised to make America “the world’s crypto capital” and has nominated pro-industry leaders to head key agencies.
In the past 12 months, shares of Coinbase and Robinhood have risen by approximately 112% and 365%, respectively, according to JPMorgan.
COIN’s performance vs. the S&P 500. Source: JPMorgan
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Raising price targets
Analysts at JPMorgan and US Tiger Securities, a stock research firm, raised price targets for Coinbase’s stock, COIN, to $344 and $300 per share, respectively, up from $264 and $265.
Coinbase’s Feb. 13 financial results show the firm hit a total revenue of $2.3 billion, up 88% quarter-on-quarter, while net income was $1.3 billion, both far exceeding analyst expectations.
In Q4, retail trading volumes on Coinbase surged to $94 billion, and institutional volumes hit $345 billion — a three-year high — “on the back of rapidly appreciating crypto market that inspired traders to reengage,” the analysts said.
Beyond trading, Coinbase earns revenues from services including digital asset custody, on-ramping stablecoins and facilitating crypto staking.
Waning regulatory barriers will increase Coinbase’s competition, but the exchange “is welcoming it as COIN sees greater participation across crypto peers and potentially TradFi players as a net positive for the overall ecosystem,” JPMorgan said.
Coinbase vs. Robinhood “take rates,” or trading fee margins. Source: Jevgenijs Kazanins
Meanwhile, JPMorgan raised targets for Robinhood shares, HOOD, to $45 from $39. It noted that crypto trading revenues are becoming an increasingly important part of Robinhood’s business.
Robinhood “reported $358mn in crypto transaction revenue, representing ~35% of total revenue, which is its highest contribution ever,” the JPMorgan analysts said in a Feb. 12 note shared with Cointelegraph.
“Typically, we see crypto revenue contribute 10-20% of revenue any given quarter,” they said.
Robinhood’s crypto revenues are poised for further growth as the brokerage prepares to add more token types and finalize its acquisition of crypto exchange Bitstamp, which Robinhood agreed to buy in June 2024.
Another top US exchange, CME Group, reported record cryptocurrency trading volumes during the fourth quarter of 2024. It also plans to add more crypto products in 2025.
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