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According to Goldman Sachs analysts, Coinbase stock is the perfect way for investors to obtain exposure to the crypto market while avoiding uncertainty.
Wall Street behemoth Following a big collapse in cryptocurrency markets, Goldman Sachs has initiated coverage of US cryptocurrency exchange Coinbase with a buy recommendation.
In a note to clients on Monday, Goldman Sachs analyst Will Nance stated that the Coinbase stock is the best way for investors to gain exposure to the crypto industry, CNBC reports. According to the report, shares of crypto companies like Coinbase should be regarded as a hedge against the parabolic volatility of cryptocurrencies like Bitcoin (BTC).
“While we believe the core business today offers an attractive growth profile with the potential to drive new high levels of profitability, we see significant white space for new initiatives to drive more stable and recurring revenue streams to complement the core trading business over the longer term,” the analysts reportedly wrote.
Goldman Sachs analysts assigned a buy rating to Coinbase stock and set a 12-month price target of $306, suggesting a 36% rise in share price. However, Coinbase’s long-term destiny would be determined by the continuing growth or lack of cryptocurrencies as an asset class, according to the client notice.
Following the newly initiated buy rating, Coinbase’s COIN shares rose nearly 3.5% to over $235 in premarket trading. The stock debuted at Nasdaq on April 14 at a price of $381. The price rebound comes in line with a notable uptick on crypto markets, with Bitcoin surging over 4% over the past 24 hours to trade above $37,400.
This is not the first time Goldman Sachs has listed Coinbase as a profitable stock. Coinbase was identified by Goldman Sachs as one of 19 U.S. stocks doing slightly higher than the S&P 500 in late April.
According to previous news, Coinbase was looking to Golman Sachs to handle its public filing in December 2020.
The latest development comes shortly after Goldman Sachs allegedly began selling Bitcoin futures to Wall Street executives in early May.