These 3 “Strong Buy” Crypto Stocks Deserve Attention Right Now
The crypto market has lost an estimated $2 trillion this year in a debacle that has left investors picking up the pieces of whatever remains of alternative currencies. However, there are a few trends that make optimists hold on for life (HODL), as even stock investors would say. Beneath the rubble are three stocks that stand to benefit once the ongoing crypto winter is over: Block, Riot Blockchain, and PayPal.
Is crypto still a good investment?
Despite the headwinds faced by the crypto market in 2022, it still has the potential to grow. Interestingly, the recently proposed bill to regulate cryptocurrencies keeps crypto winter slightly warm. If the bill passes, the Commodities Futures Trading Commission (CFTC) will handle the regulation of the crypto market. Given the expertise of the CFTC, passage of the bill may give the crypto market the support it needs to reduce volatility.
Crypto bulls think long-term and believe that like any other market, the crypto winter is also a market cycle that will run its course in due course. Optimists say this crypto winter, which can last between one and three years, will weed out short-term investors and pave the way for a recovery.
That said, the optimism around crypto is largely based on speculation. A “Paying With Cryptocurrency” survey by PYMNTS and BitPay revealed that 56% of respondents are interested in investing in the crypto market this year. Among them, about 50% are attracted by the possibility of making money as they did in 2020 and 2021, and about 15% are only so “afraid of missing out”.
Moreover, the industry is now eagerly awaiting a potential saving grace: merger. The Merge is a software upgrade from Ethereum, which supports dozens of crypto projects. The merger, which has been elusive for more than eight years, is expected to finally begin around September 15, migrating Ethereum to energy-efficient infrastructure. This would lead to more upgrades that would make trading on the platform’s signature currency, Ether, more affordable.
As the crypto market successfully holds investors’ curiosity, Wall Street is pinning its hopes on the following three stocks.
Fintech giant Block (a name that plays on founder Jack Dorsey’s blockchain ambitions) has been enjoying a series of price target increases over the past month.
While it’s true that Block’s exposure to bitcoin’s price is dampening its near-term prospects, experts are confident that the company has enough resources to bring breakthrough technology to the crypto infrastructure.
Is SQ Stock a buy or a sell?
Of all the Wall Street bulls covering SQ stock, analyst BTIG Marc Palmer is the most optimistic. Palmer has a buy rating on the stock and the highest price target of all at $175.
The analyst expects Block’s Cash App peer-to-peer payment platform to bring in around $4 billion in revenue, excluding Bitcoin revenue. He was optimistic about the healthy growth of the company’s seller ecosystem in the United States, which gave him hope for promising prospects also on the international growth front.
Block enjoys a Strong Buy rating from analyst consensus. This is based on 26 buys, six takes and one sell. Block’s stock forecast indicates an average price target of $112.97, indicating a 70.32% upside from current levels.
Payment solution provider PayPal recently joined the crypto industry standard TRUST group, which supports the privacy of CSP customers and helps businesses comply with the Travel Rule. This development can help the company avoid regulatory or compliance issues in its efforts to grow its crypto business, which is still in its infancy.
Additionally, the company announced a $15 billion share buyback program, which may provide a boost to the stock price.
Baird Analyst Colin Sebastian recently said he was positive about PayPal’s second-half performance due to easing pricing and strong growth trends driven by improving e-commerce.
PayPal also claims a larger share of the core digital wallet market. Sebastian is also optimistic about a more optimized cost profile, which should improve his bottom line. Of course, the commitment to improving shareholder returns is likely to help the company attract more investors.
Is PayPal buy, sell or block?
Sebastian maintained a Buy rating on PYPL stock, with a price target of $120. Additionally, PayPal is a strong buy consensus rating based on 24 buys and seven blocks awarded over the past three months. PayPal’s stock price forecast indicates an average price target of $119.85, reflecting a 31.52% upside from the current price level.
Riot Blockchain has an intriguing business horizon: it offers digital infrastructure, mines and sells Bitcoin (has a mining data center in central Texas for this purpose), and has operations in Denver, Colorado, which handles engineering and manufacturing of electrical equipment.
The company’s efforts to increase its hashing capacity (computational power used to mine and transact on a blockchain’s original algorithm) has sparked investor interest. Above all, by January 2023, the company should reach a hashing capacity of 12.6EH/s. If this materializes, the foundations for solid growth in 2023 and 2024 will be laid.
Will Riot Stock go up?
Wall Street analysts are unanimously bullish on Riot, with a strong buy consensus rating based on six buys. The Riot stock price prediction shows an average price target of $14.83, indicating a huge upside potential of 124% from current price levels.
It should be kept in mind, however, that Riot’s EBITDA margin is currently under severe pressure, with Bitcoin below $20,000 at the time of writing. However, if the crypto market regains momentum once the crypto winter is over and Bitcoin manages to break above $40,000 by the end of next year, then Riot stock would be poised for remarkable returns on investment.
Final Thoughts – Crypto Stocks Worth Considering
Crypto stocks are worth considering for several reasons. First, the crypto market has been battered by several headwinds this year, significantly lowering the valuation of many related assets. Moreover, big companies take it seriously and efforts are made to regulate it in a more stable market. As a result, stocks like PayPal, Riot, and Block can be good buying options for investors who don’t suffer from recency bias.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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