Baird Sees 5%-6% Q2 Revenue Miss, 35x Valuation Risk for Coinbase
COIN•Baird designated Coinbase a Bearish Fresh Pick, forecasting Q2 revenue to miss estimates by 5%-6% and trading volumes to fall 15%-20% after April and May saw multi-year lows. The firm warns Coinbase’s 35x 2027 EPS valuation is exposed, cuts price target to $142, seeing bear-case $75-$90 if multiples compress.
1. Bearish Fresh Pick Designation
Baird designated Coinbase a Bearish Fresh Pick, forecasting Q2 revenue to miss estimates by 5%-6% as trading volumes are expected to decline 15%-20%. Analyst David Koning highlighted April and May as two of the slowest months in recent years.
2. Trading Volume Weakness
Sequential volume growth is projected to fall sharply following April and May lows, with early June improvements attributed mainly to significant bitcoin sell-offs rather than genuine trading interest. Baird cautioned that this temporary surge may not translate into sustained activity across other crypto assets.
3. Regulatory and Competitive Risks
The CLARITY Act is now unlikely to pass before November’s midterms, delaying clear regulatory guidelines for crypto firms. This impasse could accelerate competitive pressures from banks and fintechs operating under established frameworks.
4. Valuation and Price Target Revision
Coinbase’s current valuation at roughly 35x 2027 EPS appears vulnerable given falling estimates and weak multiples in fintech peers. The firm cut its price target to $142 from $160 and outlined a bear-case scenario of $75-$90 if earnings fall to $3 and the multiple compresses to 25x-30x.
