Coinbase Gains Momentum on App Store—What It Means for the Stock

Key Points

• There is one uncommon indicator investors can follow to understand why Wall Street is boosting Coinbase stock higher.
• Recent Bitcoin activity and price action may have driven a wave of new investors into the cryptocurrency space.
• Short sellers cut their positions, and markets are readily paying a premium for Coinbase stock today.

There are plenty of ways to gauge sentiment around stock and its potential future price. Still, when most of them are known by the market, their accuracy and power start to fade. This is why some of the world’s best investment banks and hedge fund traders use out-of-the-box indicators to measure what’s happening behind the scenes.

Today, there are signs pointing to a potentially bullish quarter in the world of financial stocks, with this particular pick dealing with the cryptocurrency markets. Over the past quarter, the price of Bitcoin has made it to media headlines again as it broke out to a new all-time high and has hovered in some sharp price action ever since. While most people would look at the Bitcoin chart and stop there, here’s a stock that could greatly benefit from all this attention.

In shares of Coinbase Global Inc. NASDAQ: COIN, investors will find that the retail trader economy is centered around this company as the answer to buying and selling Bitcoin, amongst other currencies. This surge in activity increases the likelihood of a strong quarterly earnings report for this name. Here’s why Coinbase stock is worth taking a look at today.

Markets Reach Maximum Optimism

Despite all the excitement surrounding the cryptocurrency markets, Coinbase stock still trades at a lower 80% of its 52-week high, meaning it is in borderline bearish territory according to Wall Street’s definition, which is a 20% or more decline from recent highs.

Investors can tap into an unfair advantage and risk-to-reward setup here. After the technology sector sold off this week, led by NVIDIA Co. NASDAQ: NVDA and the DeepSeek challenge, Coinbase was also taken lower by association, though this time, it may not have been justified.

Over the past quarter, as Bitcoin gained more momentum, Coinbase has gone from being the tenth-most downloaded finance app in the Apple App Store to now being the sixth-most downloaded finance app. This indicator, which not many retail traders are always aware of, has been a reliable source of sentiment for Wall Street.

This sudden spike in downloads, especially as it’s tied to the Bitcoin price rally, means that the masses are probably crowded around Bitcoin and have been using Coinbase as a trustworthy broker and platform of their choice. Knowing this, there are a few implications for the stock moving forward.

The Market’s Take on Coinbase Stock

Understanding that many professional analysts and traders use this indicator, it shouldn’t be a surprise for retail investors to find out that Goldman Sachs analysts kept a $340 a share valuation on Coinbase stock as of January 2025, calling for as much as 21% upside from today’s price.

There were other bullish calls here as well. Monness Crespi and Hardt decided to reiterate a buy rating for Coinbase stock in December 2024, this time boosting their valuations to a high of $390 a share, which would call for a much greater upside of 39% from today’s levels. Investors can see that this small but powerful indicator is already making a splash on Wall Street.

Knowing that the majority of Coinbase’s transaction volume and revenue comes from Bitcoin, having the cryptocurrency trade within 10% of its 52-week high is also a good sign, coupled with the growth in new accounts and funding. This is exactly why, despite trading lower in the past couple of days, Coinbase stock has accumulated enough bullish evidence to scare off some bearish traders.

Investors can see this theme at play through the company’s 4.4% decline in short interest over the past month alone, a clear sign of bearish capitulation. More than that, Wall Street’s earnings per share (EPS) forecasts provide the justification for a higher price and a potential earnings beat.

Analysts think that Coinbase can deliver up to $0.94 in EPS for the same quarter next year, which is a massive multiplier over today’s $0.24 EPS level. That forecast would explain why the market is willing to pay such a steep premium for Coinbase stock over its peers.

Noticing a price-to-earnings ratio (P/E) of 48.1x, investors can see how Coinbase trades at a significant premium to the business sector’s average 28.6x P/E valuation. Now, some value investors out there might call this expensive and filled with downside. However, seasoned traders will say that the market is always willing to overpay for a stock that they believe can outperform, and this time, Coinbase fits that profile coming up to its next earnings announcement.