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JPMorgan’s crew has stuck to its guns, keeping the $196 target for Coinbase intact, even as the exchange’s Q3 results veered off analysts’ predictions. The crew, including Kenneth B. Worthington, Michael Cho, Alexander Bernstein, and Madeline Daleiden, wrote a note Friday emphasizing their belief in Coinbase’s trajectory, saying the crypto powerhouse is steadily pursuing fresh opportunities despite the blips.

“Although overall results fell short of expectations, we see Coinbase continuing to execute in emerging areas of its business,” the analysts noted, signaling potential growth in Coinbase’s evolving approach to crypto and finance. For now, their stance remains Neutral, a middle ground that balances optimism with caution.

Earnings Miss but Strategic Moves Keep Hopes Alive

Coinbase’s Q3 earnings, published Wednesday, clocked in with a $75 million net income—far from Bloomberg’s surveyed target of $112.2 million. A cool breeze for some, but JPMorgan’s analysts see broader horizons. Though the income didn’t dazzle, the company’s net revenue saw a year-on-year climb as crypto prices lingered lower last year. This quarter, revenue hit $1.13 billion, though it slipped from $1.38 billion in Q2. Yet, Coinbase continues expanding its base with a clear eye on the future, even with shifting figures.

The exchange is pushing to make crypto more useful, with projects like Base, stablecoins, and wallet systems—all crucial moves for a market on edge. Coinbase’s Base has now secured over $2.7 billion in total value locked, bringing users scalability and lower transaction fees in a leaner ecosystem.

Cost-Cutting and Regulatory Readiness Amid U.S. Shifts

JPMorgan’s analysts also praised Coinbase’s strategic cost-cuts, which they argue are paving the way for a more sustainable business. They see Coinbase as a pivotal intermediary, positioned to capitalize on a crypto market navigating an increasingly pro-regulation U.S. landscape.

The team, undeterred by recent earnings, pointed out Coinbase’s intent to lean further into clarity around regulations—a smart hedge in today’s political climate. On top of it, the firm announced a hefty $1 billion share buyback program, signaling Coinbase’s confidence in its game plan.

The Long-Term Lens on Coinbase’s Market Standing

JPMorgan’s bullish $196 target, derived from normalized earnings, reflects faith in Coinbase’s role as an innovator. Betting on active crypto markets, they forecast $4.91 per share annually, valuing Coinbase at 40x—a valuation fit for financial disruptors. For now, Coinbase hovers around $180.63, though the shares briefly tipped over $200 as excitement bubbled before the Q3 numbers hit.