ARK Invest, one of the leading institutional backers of Coinbase Global (COIN), made a significant move last Friday by offloading nearly half a million shares of the Nasdaq-listed cryptocurrency exchange.
The sale, valued at approximately $90 million, comes in the wake of a surge in analyst upgrades following Coinbase’s impressive fourth-quarter results, which surpassed Wall Street expectations.
ARK Invest’s sell-off
Led by Cathie Wood, ARK Invest sold 499,149 COIN shares across its various exchange-traded funds (ETFs). The divestment comprised 397,924 shares from the ARK Innovation ETF (ARKK), 45,433 shares from the ARK Next Generation Internet ETF (ARKW), and 55,792 shares from the ARK Fintech Innovation ETF (ARKF). As a result, ARK reduced its stake in Coinbase significantly, reflecting a notable shift in its investment strategy.
The sale by ARK Invest follows a remarkable uptick in Coinbase’s stock price, which soared nearly 27% to $180.31 over the past week. This surge was fueled by the company’s robust fourth-quarter financial results, which outpaced market expectations. In response, several prominent financial institutions upgraded their outlook on Coinbase.
KBW upgraded the stock to “market perform” from “underperform” and raised its price target to $160 from $93. Additionally, analysts at Wedbush, Canaccord Genuity, and JMP Securities raised their price targets for Coinbase, reflecting growing optimism among investors.
Mixed analyst sentiment
Despite the positive sentiment from some analysts, others remained cautious about Coinbase’s prospects. JPMorgan criticized the exchange for its perceived lack of transparency regarding the impact of spot bitcoin exchange-traded funds on its business.
This skepticism highlights lingering concerns within the financial community regarding Coinbase’s ability to navigate regulatory challenges and adapt to evolving market dynamics. Similarly, Mizuho maintained its “underperform” rating on Coinbase stock and retained a price target of $60, citing concerns about its performance.
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