HCW is super bullish on Coinbase stock despite SEC lawsuit

On Tuesday, the U.S. Securities and Exchange Commission sued Coinbase Global Inc (NASDAQ: COIN) for violating securities laws. Still, an HCW analyst remains bullish as ever on the stock.

Coinbase stock has upside to $77

Mike Colonnese is convinced that the recent sell-off in shares of the crypto exchange is overdone and presents an opportunity for the long-term investors.

To that end, he reiterated his price objective of $77 on Coinbase stock in a research note this morning that suggests a whopping 45% upside from here.

Coinbase stock now trades at ~3.5x 2023 consensus revenue forecasts, an attractive entry point for investors, as we see it.

His bullish view is in line with Cathie Wood who spent another $21 million on the crypto stock as it declined following the SEC’s complaint.

SEC doesn’t see BTC or ETH as securities

In his research note today, Colonnese noted that the Securities and Exchange Commission did not classify Bitcoin and Ethereum as securities. The two cryptocurrencies make up more than half of the trading volume on Coinbase.

He agreed that the regulator will weigh on the Coinbase stock in the near-term but said the next crypto bull run will likely help the share price. The analyst also added:

We remain bullish on BTC. Meanwhile, Coinbase remains the dominant crypto exchange in the U.S. with a robust customer base, significant commercial partnerships, and is increasing global presence.

Last year, BlackRock partnered with the crypto exchange to enable its institutional clients to trade Bitcoin as Invezz reported here. HCW continues to expect Coinbase to generate $2.96 billion in net revenue this year.