It's time to sell Coinbase as the drawdown in cryptocurrency prices continues to put pressure on the exchange platform, Goldman Sachs says. Analyst Will Nance downgraded the stock to a sell from a neutral rating, saying in a note to clients that the company needs to reduce costs to slow its cash burn as the appetite for cryptocurrency trading dries up. "We believe current crypto asset levels and trading volumes imply further degradation in COIN's revenue base, which we see falling ~61% YoY in 2022, and ~73% in the back half of the year," Nance wrote. Earlier this month Coinbase cut 18% of its workforce as it prepares for a potential recession and deals with the fallout from crypto decline this year. Additional cuts are likely needed in the future, Nance said. The price of bitcoin has been cut in half in the last three months. Along with the downgrade, Goldman Sachs slashed its price target on the stock to $45 from $70, which implies a 28% downside from Friday's close price. The bank upgraded Robinhood to neutral from a sell rating in the same note as its shares could rally 19% from its recent close, the bank said. — CNBC's Michael Bloom contributed reporting
The logo for Coinbase Global Inc, the biggest U.S. cryptocurrency exchange, is displayed on the Nasdaq MarketSite jumbotron and others at Times Square in New York, U.S., April 14, 2021.