Where I'd value coinbase

[jackg]

disclaimer: this is education and my 2 cents only from what I've seen with large cap companies
Tldr: $8bn-30bn is a reasonable market cap estimate for the immediate term imo. But it's likely we'll drop hard if crypto drops. I have not bought the stock but I intend to buy 1 and only 1.

I wanted to post this in case anyone was onsidering investing in them and because many might not know how to value a stock.

First of all, I'm going to focus only on earnings and revenues when working these out and provide an upper bound and lower bound for each (this isn't investment advice). Other values have potential for being "aggressively overestimated".

There WILL be a massive slump in trading next year the potentially the year after, there won't be as much day trading and many day traders will turn to turning btc into other alts rather than cashing in so this probably should be considered in everything.

Given current revenue for the first quarter of $1.8bn, this is $7.2bn for the year so would see them being valued around $14.8bn-$36bn.

Based off current profits of $750m (since they don't provide concrete data) they'll probably be valued at $10bn-30bn.

I'm not sure what the market cap of these are but if you can catch it under $30bn, it might be a realistic investment for hodling.

I think it's likely they'll be doing stock buybacks if bit coin's price crashes so selling a dip might be profiting them

It seems quite well timed they've come out with this stuff now. A 4 year hodl or a 3 month hodl would probably be my advice. Their market share might also continue to plummit since it's also only at 11% now according to their report which seems quite low. The rest I can only think is being made up from binance and otc desks.

[Iron Fist]

disclaimer: this is education and my 2 cents only from what I've seen with large cap companies
Tldr: $8bn-30bn is a reasonable market cap estimate for the immediate term imo. But it's likely we'll drop hard if crypto drops. I have not bought the stock but I intend to buy 1 and only 1.
...

With an estimated 266.2 million shares, does that imply a maximum price of $ 120 per share?

[jackg]

disclaimer: this is education and my 2 cents only from what I've seen with large cap companies
Tldr: $8bn-30bn is a reasonable market cap estimate for the immediate term imo. But it's likely we'll drop hard if crypto drops. I have not bought the stock but I intend to buy 1 and only 1.
...

With an estimated 266.2 million shares, does that imply a maximum price of $ 120 per share?

It may suggest it'd stabalise there. But coinbase do have a high profit margin and my figures are based just off averages for companies.

Some emerging companies can be worth millions of times their revenue (but normally have negative profits).

[The Sceptical Chymist]

With an estimated 266.2 million shares, does that imply a maximum price of $ 120 per share?

That number of outstanding shares seems to have changed from yesterday, at least according to my broker.  I'd posted about it yesterday when it looked like there were only 21 million shares, but when I looked just now I saw it changed:



I'm not sure what number to believe, and I'm not all that familiar with how many shares are usually offered in an IPO. 

There WILL be a massive slump in trading next year the potentially the year after, there won't be as much day trading and many day traders will turn to turning btc into other alts rather than cashing in so this probably should be considered in everything.

You could be right about that, though you never know if Coinbase will adapt to whatever changes take place.  In any case, I don't plan on buying any shares of COIN, and I don't use Coinbase, so I'm just a semi-interested bystander who's got the stock on his watchlist.  I can't stand them as an exchange, but I do wish them well because their success would be good for crypto as a whole.

[izsara]

There are too many topics that talk about Coinbase and it makes me confused to conclude the problems that are happening to users on Coinbase. some say the improvement is drastic and makes for a great achievement, but complaints from users are increasingly coming. So can't Coinbase solve these problems one by one?

[stompix]

There WILL be a massive slump in trading next year the potentially the year after, there won't be as much day trading and many day traders will turn to turning btc into other alts rather than cashing in so this probably should be considered in everything.

Hmm, ok, everyone has a scenario but what makes you think we are going to see a radical change in that direction?
In my opinion, indeed the bull run can't last for long at prices that make trading BTC obsolete, but a flat or a bear season usually is more destructive for altcoins, trading them would be more of a gamble than already is.

Besides, I don't think that the current customers of Coinbase nor their target market is keen on that sort of play, it might be just my impression but binance users are more inclined to high-risk trading. In my opinion, Coinbase seems to be better anchored in the crypto space, enough to survive even a few years of price and volume decline, unlike other exchanges who need constant fresh blood to keep their customers active.

I can't stand them as an exchange, but I do wish them well because their success would be good for crypto as a whole.

About the same here, I don't like them at all, but others I hate more 

[Tytanowy Janusz]

There WILL be a massive slump in trading next year the potentially the year after, there won't be as much day trading and many day traders will turn to turning btc into other alts rather than cashing in so this probably should be considered in everything.

First we will see a massive pump of trading volumes later this year. Will it pump COIN price? I guess not ...wall street guys are too smart to hype into comany that most likely will see na 90% income drop in next 2 years.

Given current revenue for the first quarter of $1.8bn, this is $7.2bn for the year so would see them being valued around $14.8bn-$36bn.

Based off current profits of $750m (since they don't provide concrete data) they'll probably be valued at $10bn-30bn.

P/E 13-40. That's pretty much how I would evaluate COIN currently but taking volume going down like 90% in next 2 years, annual profit will dump to like $100m making fair evaluation around $1B - $2B



Currently coinbase is bigger than CME, London stock exchange and many more. Looks unrealistic.