Is Coinbase a Bargain After a 25% Drop Amid Regulatory Headlines in 2025?

• Wondering if Coinbase Global stock is actually a bargain, or if the hype is already baked into the price? You are not alone; plenty of investors are looking for answers in this wild market.
• Coinbase shares have swung sharply lately, dropping 15.3% in the past week and 24.9% over the past month, while still boasting a staggering 442.9% gain over the last three years.
• Much of this volatility connects to recent headlines about regulatory moves in the crypto space and shifting sentiment around digital assets. News regarding potential changes in crypto policy and increased market scrutiny have kept traders on their toes and helped drive those swift price swings.
• Based on traditional valuation checks, Coinbase Global scores a 2 out of 6 for being undervalued. There is far more to understanding a stock’s true worth than just running the numbers. We will dig into different approaches below and reveal an even better way to judge value at the end of this article.

Coinbase Global scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Coinbase Global Excess Returns Analysis

The Excess Returns approach evaluates a company by measuring how much value it generates above the cost of equity for each dollar invested. In other words, it estimates the returns shareholders receive over and above what they could expect from simply investing elsewhere with similar risk. This method is particularly useful for businesses such as Coinbase Global that may not pay dividends and have unpredictable growth patterns.

For Coinbase Global, the key inputs are as follows:

• Book Value: $59.62 per share
• Stable EPS: $8.90 per share (Source: Weighted future Return on Equity estimates from 7 analysts.)
• Cost of Equity: $4.94 per share
• Excess Return: $3.96 per share
• Average Return on Equity: 15.00%
• Stable Book Value: $59.36 per share (Source: Weighted future Book Value estimates from 3 analysts.)

Using this model, Coinbase Global's intrinsic value is estimated at $137.68 per share. However, this is 74.6% below its current trading price, suggesting that the stock is significantly overvalued according to the Excess Returns methodology.

Result: OVERVALUED

Our Excess Returns analysis suggests Coinbase Global may be overvalued by 74.6%. Discover 921 undervalued stocks or create your own screener to find better value opportunities.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Coinbase Global.

Approach 2: Coinbase Global Price vs Earnings

The price-to-earnings (PE) ratio is one of the most widely used valuation metrics for profitable companies like Coinbase Global. It quickly shows how much investors are willing to pay for one dollar of earnings, offering a simple way to gauge whether a stock is priced reasonably compared to its profits.

Growth expectations and risk play a central role in shaping what is considered a "normal" or "fair" PE ratio. Faster-growing businesses and those with more stable earnings typically command higher PE ratios. In contrast, companies facing greater uncertainty or slower growth are often given lower multiples by the market.

Looking at Coinbase Global, the current PE ratio stands at 20.15x. This is below both the industry average of 23.39x for capital markets peers and the peer average of 30.82x. However, these benchmarks do not account for the unique profile of Coinbase Global in terms of its growth potential, risk, margins, and size.

This is where Simply Wall St’s Fair Ratio comes in. The Fair Ratio is a proprietary metric that estimates the most reasonable PE multiple for a stock, factoring in earnings growth forecasts, company-specific risks, profit margins, and market capitalization alongside industry norms. By considering this broader context, the Fair Ratio offers a more customized and fair valuation benchmark than simply comparing with peers or the industry at large.

For Coinbase Global, the Fair Ratio is calculated at 19.33x. With the company’s actual PE ratio at 20.15x, the difference is less than 0.10. This indicates that the stock is trading almost exactly in line with its fair value based on these parameters.

Result: ABOUT RIGHT

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1421 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Coinbase Global Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let’s introduce you to Narratives—a simple yet powerful tool that helps you connect both the numbers and the story behind a company like Coinbase Global.

A Narrative is your investment perspective. It allows you to articulate how you see Coinbase’s business evolving and to back up your view with specific assumptions about future revenue, earnings, and margins. This approach links the company’s story to a tailored financial forecast and then to a dynamic fair value. This helps you better visualize whether the current price aligns with your outlook.

On Simply Wall St’s Community page, millions of investors use Narratives to define, share, and refine their own valuation stories for each stock. By comparing each Narrative’s fair value with the latest price, you can quickly decide whether Coinbase is a buy or sell for you. As new data or news breaks, Narratives automatically update to reflect the changing picture so your decision-making stays relevant and informed.

For example, some investors believe aggressive blockchain expansion and new institutional partnerships could push Coinbase’s fair value as high as $510 per share. Others, concerned about trading volumes and rising risks, see it closer to $185. This shows how Narratives empower you to invest according to your own conviction.

Do you think there's more to the story for Coinbase Global? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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