Hedge Funds Were Right About These 5 Sinking Stocks

2. Coinbase Global, Inc. (NASDAQ:COIN)

Number of Hedge Fund Shareholders: 46

Year-to-Date Returns: -75.1%

Coinbase Global, Inc. (NASDAQ:COIN) has been relatively popular among hedge funds since its public debut in the second quarter of 2021, but hedge fund ownership fell by 19% during the first quarter as the cracks in the crypto craze began growing wider. Winston Feng’s MassAve Global and Mark Coe’s Intrinsic Edge Capital were some of the funds to unload their Coinbase positions in Q1.

Coinbase Global, Inc. (NASDAQ:COIN) has also been rebounding lately on the strength of BTC and then jumped even further when it formed a partnership with BlackRock Inc. (NYSE:BLK) that will see Coinbase provide crypto trading and custody services to BlackRock’s Aladdin customers. While JMP Securities analyst Devin Ryan doesn’t expect the partnership to a major revenue boon for Coinbase, he likes the optics of it for both the company and industry. Ryan has a $205 price target and ‘Outperform’ rating on COIN shares.

Rowan Street cited Coinbase Global, Inc. (NASDAQ:COIN) founder and CEO Brian Armstrong’s passionate and driven mentality in its Q2 2022 investor letter:

“The mentality of a passionate Founder/CEO drives a completely different thought process and decision-making that makes all the difference. This is a quote by Brian Armstrong, Founder and CEO of Coinbase (NASDAQ:COIN):

‘I can speak with some authority and say we are not going to do that because this is not why I started the company – I don’t have to give any other justification. Rather than the professional CEO that comes in that is accountable to Wall Street and quarterly earnings may start thinking about the company differently. One of the most scarce things in companies today is risk tolerance. For example, take Tesla vs. Waymo. Tesla launched self-driving cars while Google didn’t. The reason is the founder-CEO (Elon Musk) said that I care enough about the mission that we are ready and we are gonna go for it. Whether a professional CEO is thinking about his/her career trajectory, the founder CEO doesn’t care about the next job and only cares about the mission.’