Shares of Coinbase Global COIN moved lower on Friday after Baird reiterated its Neutral rating on the cryptocurrency exchange operator but lowered its price target, warning that weak trading activity could continue to weigh on the business.
Coinbase stock fell nearly 7% in trading to around $152.
The shares have struggled throughout 2026, declining roughly 34% since the start of the year as cryptocurrency prices have remained near their 52-week lows.
Baird also named Coinbase a “Bearish Fresh Pick,” citing concerns that soft trading volumes may persist for an extended period and could lead to disappointing second-quarter results.
Weak trading activity clouds revenue outlook
Although Coinbase has expanded beyond its core trading business over the past several years, transaction revenue remains a major driver of financial performance.
Baird analyst David Koning expects the company’s second-quarter revenue to come in approximately 5% to 6% below Wall Street expectations, with trading volumes projected to decline between 15% and 20% sequentially.
The analyst noted that activity across the crypto market has remained subdued despite some improvement in early June.
“April and May were two of the slowest months in the past few years,” Koning wrote, noting that Robinhood’s chief brokerage officer recently highlighted strength in equities, options, futures, and predictions but made no mention of crypto.
Baird also questioned whether the modest rebound in June trading volumes reflects sustainable demand.
“While the first few days of June showed decent volume (closer to average levels of recent years), we think it’s due to significant trading out of Bitcoin, which may be followed by limited interest in trading,” wrote analyst David J. Koning.
The brokerage argued that the broader crypto market continues to face several headwinds, including the strong performance of the S&P 500, elevated inflation, high borrowing costs, and competition from other high-growth investment themes such as artificial intelligence stocks and new initial public offerings.
Regulatory uncertainty remains a concern
Baird also pointed to uncertainty surrounding the proposed CLARITY Act, a market-structure bill that many cryptocurrency supporters view as an important step toward broader industry adoption.
According to the firm, legislative disagreements over ethics and crypto issuance issues make it increasingly unlikely that the bill will pass before the November midterm elections.
The delay, Baird said, could allow banks and financial technology companies operating under existing regulatory frameworks to strengthen their competitive positions.
Prediction market platform Polymarket currently assigns a 57% probability that the legislation will become law this year, down from 65% a month earlier.
Valuation debate intensifies
Alongside concerns about slowing growth, Baird also argued that Coinbase’s valuation could come under additional pressure if earnings expectations continue to fall.
The brokerage lowered its price target to $142 from $160 and noted that the stock currently trades at roughly 35 times estimated 2027 earnings per share.
“The combo of falling estimates and weak multiples across beat/raise fintechs could eventually bleed into COIN’s valuation,” the firm wrote.
In its bear-case scenario, Baird believes the stock could decline to between $75 and $90 if 2027 earnings per share fall to $3 and the valuation multiple contracts to 25 to 30 times earnings.
Despite the cautious outlook, Baird remains more bearish than much of Wall Street.
According to FactSet data, approximately 64% of the 39 analysts covering Coinbase currently rate the stock a Buy, with the average price target standing at about $231.
