Coinbase shares dropped 9% after Goldman Sachs’ report downgraded the company. Coinbase share’s value is now $56.88.
Goldman Sachs is a leading investment bank and financial services company. Its analyst, Will Nance, lowered Coinbase’s price target in his report, from $70 to $45. America’s largest crypto exchange rating was also downgraded from “neutral” to “sell”. In investment terms, the “sell” rating indicates that the shares’ value is likely to further drop.
The report states that Coinbase’s year-over-year revenue could fall by more than 60%. It also suggests that further cuts in the company’s workforce are needed. This comes after the news of Coinbase firing 18% of its employees.
In April 2021, Coinbase started trading on the stock exchange Nasqar. Since then, shares have declined 85%, from COIN’s debut price of $381 in April,
Just a few days ago, Coinbase was downgraded by the credit ratings agency Moody, as well. The agency stated that “Today’s rating action reflects Coinbase’s substantially weaker revenue and cash flow generation due to the steep declines in crypto asset prices that have occurred in recent months and reduced customer trading activity”.
In May, Coinbase reported a quarterly loss amounting to $430 million. The exchange also noted a 19% drop in the number of monthly users.