Bank of America resets forecast for S&P 500 company

Core Viewpoint - Bank of America has revised its forecast for Coinbase, highlighting its potential for strong performance into 2026 due to product expansion, strategic pivots, and improved valuation [1][2] Group 1: Company Overview - Coinbase, founded in 2012, operates the largest cryptocurrency exchange in the U.S. and went public in 2021, joining the S&P 500 index in May 2025 [1] - The company aims to become the "everything exchange," expanding its offerings beyond cryptocurrencies to include stocks, ETFs, and prediction markets [2] Group 2: Market Position and Valuation - Bank of America noted that Coinbase's shares have decreased approximately 40% from their July highs, creating a more attractive entry point for investors [2] - The price-to-earnings (P/E) ratio of Coinbase has significantly compressed since mid-2024, enhancing the stock's risk-reward profile [6] Group 3: Strategic Initiatives - Coinbase is developing its layer-2 network, Base, on Ethereum, which is seen as a crucial step in evolving from a trading platform to a broader crypto infrastructure provider [5] - The potential launch of a native token and the Coinbase Tokenize initiative could position Coinbase as a leader in tokenization, combining issuance, custody, compliance, and access to a large client base [5][6] Group 4: Future Outlook - Bank of America views Coinbase as a long-term winner in the cryptocurrency industry, which is still in the early stages of adoption [7] - The analyst anticipates a more favorable regulatory environment in the U.S. under President Donald Trump, which could provide significant advantages for Coinbase in 2026 [7]