Coinbase stock slips after Atlantic Equities steps to the sidelines

Jul. 06, 2022 8:13 AM ETCoinbase Global, Inc. (COIN)By: Liz Kiesche, SA News Editor4 Comments

Coinbase Releases Third-Quarter Financial Results

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  • Coinbase Global (NASDAQ:COIN) stock is dropping 3.8% in Wednesday premarket trading after Atlantic Equities analyst Simon Clinch downgraded the cryptocurrency exchange company to Neutral from Overweight on concerns over its ability to attract talent in the longer term.
  • The analyst also expressed concern about the spread of misinformation over the company's financial strength and consumer asset protections.
  • "Additionally, our hopes for some stabilization in crypto prices and volumes have been dashed, with both tracking much weaker than expected," Clinch wrote in a note to clients.
  • Noting the downside risk of a prolonged and more severe crypto winter, Atlantic Equities reduces base case expectations. Net revenue estimate is cut by 10% for FY22 and by more than 50% in FY23 and FY24.
  • In May, Seeking Alpha's Quant system flashed red on Coinbase (COIN), warning that the stock is at high risk of performing poorly. It puts a Strong Sell rating on the stock. Meanwhile, SA Authors' average rating of Neutral aligns with Clinch's rating.
  • SA contributor Dilantha De Silva sees Coinbase (COIN) as a risky short-term bet but an attractive stock for a long-term investor.

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