Does Coinbase Carry A 'Hidden Value' In $6.6B Ventures Business?

Coinbase Global Inc COIN has hidden value that is yet to be realized through its Ventures business, according to Oppenheimer analysts, CoinDesk reported on Monday.

The Coinbase Analyst: Oppenheimer analysts arrived at an 'outperform' recommendation for Coinbase shares with a price target of $377. They believe the stock is likely to move in tandem with the price of Bitcoin BTC/USD and macroeconomic pressure.

The Coinbase Thesis: Oppenheimer research analyst Owen Lau said that Coinbase’s Ventures unit is “strategically important” to the cryptocurrency exchange even though the investment firms aren’t yet contributing financially, in a note to clients seen by CoinDesk.

Coinbase's Ventures unit invests primarily in early-stage cryptocurrency and blockchain startups, and its portfolio has a fair value of $6.6 billion, based on Oppenheimer’s estimates. 

Analysts have estimated that the portfolio consists of more than 250 cryptocurrency-focused companies with a carrying value of around $352 million at cost-basis.

Assuming a 13% ownership stake, a sensitivity analysis revealed that the market value of these assets could go as high as $17 billion, Lau said in the note.

Coinbase has a market cap of about $40 billion as of its last close on Monday.

See Also: How To Buy Bitcoin (BTC)

Tesla Inc. TSLA superbull Cathie Wood also believes in the long-term value of Coinbase and has been piling up shares in the cryptocurrency exchange ever since its initial public offering.

Price Action: Coinbase shares traded 1.51% higher during the after-market session. At press time, Bitcoin was trading at $39,000, gaining 2.32% in the last 24 hours.