Morgan Stanley Cuts Coinbase Price Target After Weak Outlook
Morgan Stanley points to weak trading volumes and lower revenue expectations after Coinbase’s disappointing quarterly results and uncertainty in the crypto market.
Key Takeaways
- Morgan Stanley downgraded Coinbase to underweight and cut its price target from $258 to $120.
- The bank expects weak crypto trading and lower revenue expectations to weigh on Coinbase’s profits for years.
- Coinbase shares fell 2.3% in early trading after a 10% drop last week.
Morgan Stanley has downgraded Coinbase to underweight and cut its price target from $258 (€231) to $120 (€107). The bank warns that weak crypto trading and lower revenue expectations could weigh on the crypto exchange’s profits for years. Coinbase shares fell 2.3% in early trading to $140.25 (€126), after a 10% loss last week.
Weaker Trading Pressures the Outlook
Analyst Michael Cyprys wrote that confidence in a rebound in profits has weakened further. According to him, weaker trading activity, a lower revenue outlook, and uncertainty in the crypto market after the recent Binance hack all played a role in the bearish call.
That caution fits into a broader market where trading volumes have been under pressure for some time. In the first quarter of 2026, spot volume on centralized exchanges fell 39.1% to $2.7 trillion (€2.4 trillion), while March set a new monthly low of $0.8 trillion (€0.7 trillion). For companies like Coinbase, which make much of their revenue from transaction fees, that is a tough environment.
Sharp Cut to Forecasts
Morgan Stanley cut its 2027 revenue estimate by 28% and its adjusted EBITDA forecast by 47%. For 2028, the revenue and EBITDA estimates were lowered by 18% and 25%, respectively.
The bank now expects $2.4 billion (€2.1 billion) in normalized EBITDA in 2028, about 14% below the 2025 level. At the same time, Morgan Stanley lowered the multiple it uses to value EBITDA from 20 to 12 times.
The downgrade follows the weak quarterly results Coinbase published last Thursday. The company reported $1.22 billion (€1.1 billion) in revenue, 35% less than a year earlier and barely changed from the previous quarter. Transaction revenue fell 44% to $590 million (€528 million), while subscription and services revenue dropped 20% to $570 million (€510 million).
The outlook for the fourth quarter also gave little reason to expect a quick rebound. Coinbase said it had about $165 million (€148 million) in transaction revenue through October 25 and expects subscription and services revenue of $550 million (€492 million) to $630 million (€564 million). Adjusted expenses are expected to come in at $1.01 billion (€0.9 billion) to $1.16 billion (€1 billion), compared with $975 million (€873 million) in the third quarter.
Why This Matters
For European crypto readers, this downgrade shows how sensitive publicly traded crypto companies still are to lower trading activity. Even if the prices of major tokens recover, weak trading momentum can still hit exchange revenue. That makes Coinbase’s numbers relevant outside the United States too, for understanding the broader crypto market. Coinbase’s earlier profit drop and revenue miss also showed how quickly the market reacts to disappointing trading income.