Is Now the Time to Buy Coinbase (COIN) Stock as Bitcoin Dips Below $100K?

Bitcoin's Resilience Amidst Dips

Despite Bitcoin sliding below $100,000, it has impressively risen over 120% in 2024. This surge has significantly boosted the stock performance of Coinbase Global (COIN), which has soared by 80% year to date. With COIN down 9% in Monday's trading session, investors may see this as an opportunity to buy the dip.

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Coinbase's Impressive Financial Metrics

Driven by the cryptocurrency rally, Coinbase reported a 100% increase in quarterly sales, reaching $1.2 billion compared to $674.15 million in the same quarter last year. More notably, the company achieved a Q3 EPS of $0.62 with a net income of $75 million, marking its fourth consecutive quarter of positive net income. Furthermore, Coinbase has exceeded the Zacks EPS Consensus for seven straight quarters, boasting an average earnings surprise of 341.36% in its last four reports.

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Strategic Focus on Revenue Growth

According to CEO Brian Armstrong, Coinbase's priority has shifted from volatile transaction fees to subscription and services revenue. For fiscal 2024, total sales are projected at $5.61 billion, an 80% increase from $3.11 billion last year, though a slight dip to $5.48 billion is expected in FY25.

Future Earnings Projections

Annual earnings are anticipated to skyrocket to $5.39 per share this year, compared to $0.37 EPS in 2023. Although EPS is expected to contract to $3.15 in FY25, earnings estimates have surged recently, with a notable increase of 4% in FY24 EPS estimates over the past two months.

Image Source: Zacks Investment Research

Driving Utility and Regulatory Clarity

Coinbase aims to enhance the utility and regulatory clarity of cryptocurrency, focusing on digital wallets and payment solutions to make crypto more accessible. The recent rally in both Coinbase’s stock and Bitcoin has been fueled by perceptions that President-elect Donald Trump is more supportive of cryptocurrency, pledging to create a friendly regulatory environment for the industry.