If you are trying to work out whether Coinbase Global’s share price still makes sense after recent crypto swings, the key question is how its current market value compares with what the underlying business might justify. The stock last closed at US$254.92, with a 10.1% return over the past week, a 5.5% decline over the past month and a 7.8% gain year to date, while the 1 year return sits at a 3.6% decline and the 3 year return is very large. On our checks, Coinbase Global scores a 3 out of 6 valuation score. We will look at what different valuation approaches say about that number, and then finish with a way to think about value that goes beyond any single model.
The Excess Returns model looks at how efficiently Coinbase Global turns shareholder capital into profits, and then asks how much of those profits are above the return that investors typically require. Here, the starting point is book value of $59.62 per share and a stable earnings per share estimate of $7.41, based on weighted future Return on Equity inputs from 7 analysts. The average Return on Equity used in the model is 13.28%, compared with a cost of equity of $4.67 per share, creating an estimated excess return of $2.74 per share. When those excess returns are capitalised, the model produces an intrinsic value of about $109.58 per share, which compared with the recent share price of $254.92 implies Coinbase Global is 132.6% overvalued on this framework.
Coinbase Global currently trades on a P/E ratio of 21.36x, below the Capital Markets industry average P/E of 25.75x and below the peer average of 35.46x. Simply Wall St’s Fair Ratio for Coinbase Global is 21.93x, suggesting the stock is broadly fair on that metric. Narratives also play a role: one investor might forecast a higher fair value around $383.46, while another could set a more cautious near $185. Narratives help readers compare multiple forward views alongside a single model to decide whether the price looks attractive, rich, or somewhere in between.
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