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The largest crypto exchange in America is cutting 18% of its staff. An analyst at Goldman said it’s not enough. Coinbase shares dropped 9% to $56.88 Monday, after Goldman Sachs downgraded it to “sell” (neutral) and lowered its price target from $70 to $45
Analyst Will Nance also noted in a note addressed to investors that further cuts were needed in the company’s workforce. This is despite Coinbase recently stating it would fire 18% its workforce and accepting offers for incoming employees.
Nance stated that the current levels of crypto assets and trading volumes indicate a further decline in COIN’s revenue base. He also said that revenue year-over-year could drop by more than 60%.
A “neutral” rating, in investment terms, is neither bullish or bearish. A “sell” recommendation means shares are likely to decline.
The largest cryptocurrency exchange in America, Coinbase, began trading on Nasdaq in 2021. The shares have fallen 85% since COIN’s debut price of $381 in April 2021. This is because Bitcoin and other digital assets have also plummeted. As a result, the company receives fewer commissions.
Goldman’s downgrade comes just days after Moody’s had Coinbase’s corporate bond downgraded . In a note, they wrote: “Today’s rating actions reflect Coinbase’s significantly weaker revenue generation and cash flow generation due the steep declines crypto asset prices have experienced in recent months and decreased customer trading activity.”
The post Damning Prediction Made by Goldman Sachs for Coinbase Shares first appeared on The Daily Encrypt.
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