Goldman Sachs analysts are not high on shares of cryptocurrency exchange Coinbase despite signs that the crypto market is healing. The analysts at the American investment bank have recently updated the rating of Coinbase stock (COIN) and downgraded it from Neutral to Sell.
Sending a note to clients on Monday, Goldman Sachs analyst Will Nance said that his price target on COIN dropped from $70 to $45.
“We believe current crypto asset levels and trading volumes imply further degradation in COIN’s revenue base,” Nance wrote.
Coinbase recently made a series of moves in an attempt to cut the costs amid the crypto market crisis. This included laying off 18 percent of employees and withdrawing job offers made in the past month. However, Nance believes this isn’t enough.
“We believe COIN will need to make substantial reductions in its cost base in order to stem the resulting cash burn as retail trading activity dries up,” he added.
Coinbase stock lost close to 80 percent in value in the past six months. It closed at $57.08 on Monday, compared to the $357.39 peak in late 2021.
In the same note, Goldman upgraded Robinhood stock from Sell to Neutral. This came two months after the stock was initially downgraded.