After market close today, Coinbase (COIN) reported its Q2-2022 earnings results. Earnings per share (EPS) results missed by a large amount, as the company posted EPS of -$4.98 compared to estimates of -$2.47. In addition, its revenue of $808.3 million missed analysts’ expectations of $832.2 million, representing a year-over-year decline of close to 64%. The stock is currently down 4.6% in the after-hours trading session.
Coinbase’s net loss was ~$1.1 billion, $446 million of which was due to non-cash impairment charges associated with its past investments. In the same quarter last year, COIN experienced a gain of nearly $1.6 billion.
Also, monthly transacting users fell 2% quarter-over-quarter, to 9 million users. Similarly, retail transaction revenue fell 66% to $616.2 million, much below the $667.1 million analyst consensus.
Coinbase narrowed its outlook for monthly transacting users to be between seven million and nine million users compared to a range of five million to 15 million users.
Additionally, the company plans to lower its technology, development, and general and administrative spending from the previous quarter’s projections by about $1.0 billion to $1.25 billion, which implies spending of $4.0 billion to $4.25 billion.
Amid hiring freezes, job cuts, falling revenues, and a “crypto winter” (a crypto bear market), COIN stock is down about 67% year-to-date.
Not to mention, Coinbase has also experienced a slowdown in website traffic, which was warned about in a previous TipRanks article.
What Do Analysts Think of COIN Stock?
Currently, Wall Street analysts view Coinbase stock as a Moderate Buy based on 13 Buys, six Holds, and two Sells. The average COIN price target of $111.58 implies 27.3% upside potential from today’s closing price. One of the Buy ratings comes from five-star JMP Securities analyst Devin Ryan, who is ranked #288 out of 21,372 overall experts.
It will be interesting to see how many analysts maintain their Buy ratings following the company’s earnings report.
TipRanks’ Top Retail Investors are Bullish on COIN Stock
TipRanks currently tracks 551,954 investor portfolios that use the Smart Portfolio tool. The top investors, which amount to 110,390 portfolios, appear highly bullish on COIN stock. In the past 30 days, the number of top-performing TipRanks portfolios holding COIN stock increased by 11.2%. In the past seven days, this number increased by 1.6%. This leads to very positive investor sentiment, above the sector average, as shown in the image below:
Conclusion: Is COIN Stock a Buy after Earnings?
Coinbase didn’t have a great quarter, missing on both revenue and EPS estimates. Also, its guidance isn’t exactly great either. Nonetheless, analysts are cautiously optimistic about the stock, and top retail investors are also bullish. The company is facing headwinds due to a slowing economy and a falling crypto market. However, if you believe that the crypto market will recover in the long term, then COIN could be a solid stock to buy at its currently-depressed levels.