Coinbase isn’t going the traditional initial public offering route, instead the company is listing its stock directly and was expected to begin trading on the NASDAQ exchange (under “COIN”) Wednesday afternoon.
What’s it worth? There is a discrepancy of opinion as investors mull the relative worth of the burgeoning cryptocurrency momentum.
Coinbase shares were indicated to open at about $360 per share, according to a CNBC story, after providing a reference price of $250 per share Tuesday.
An advantage of skipping the IPO is that Coinbase employees and existing shareholders can sell shares immediately at a market prices – the reference price is not a firm setting and no shares changed hands at that level.
Coinbase is a cryptocurrency exchange medium. The company was founded in 2012 and, CNBC says, has grown from 32 million users in 2019 to 56 million today.
Again, what’s it worth?
In its last private financing round in 2018, investors valued Coinbase at $8 billion.
“Based on a fully-diluted share count, the indicated opening would give Coinbase a market cap of over $94 billion. Excluding options and restricted stock units, the market value would be about $67 billion.”
New Constructs CEO David Trainer isn’t on board.
“I think it’s worth closer to $5 billion or $10 billion as opposed to $100 billion,” Trainer told Yahoo Finance Live. “Look, this is the brokerage industry — it’s not new. Coinbase is not reinventing the wheel here in any way.”
For the full year of 2020, Coinbase saw its revenue more than double to $1.28 billion and moved from a loss in 2019 to a profit of $322.3 million.
Investors will closely monitor bitcoin and ethereum, which have climbed more than 800% and 1,300%, respectively, in the past year. Coinbase said short-term success will be tied to crypto prices.