Watch 5 Bitcoin-Centric Stocks Set to Gain From the Next Rally

The cryptocurrency market suffered a severe blow in the past one and a half months. Bitcoin (BTC), the largest cryptocurrency globally, hit an all-time high of $73,750 on March 14. However, the broader market bloodbath from early August saw cryptocurrencies suffering. Consequently, Bitcoin fell to below $55,000. At present, Bitcoin is trading around $57,940, a 21.4% discount to its all-time high.

Nevertheless, investors should think from a long-term perspective. The Fed is undoubtedly approaching the end of the higher rate regime. A low interest rate is beneficial to high growth-oriented industries such as technology, consumer discretionary and cryptocurrency.

We believe that investors should accumulate bitcoin using a buy-on-the-dip strategy. Every dip in the bitcoin price will be a good purchasing point in order to gain handsomely once the Fed’s tighter monetary control comes to an end.

At this stage, investors should carefully watch bitcoin-centric stocks. Five such stocks are — Robinhood Markets Inc. HOOD, Coinbase Global Inc. COIN, NVIDIA Corp. NVDA, Interactive Brokers Group Inc. IBKR and Block Inc. SQ.

Near-Term Positive for Bitcoin

Following the release of a series of weak economic data for July and August, especially the labor market data, the CME FedWatch tool currently shows a 100% probability of a 25-basis point interest rate cut in September.

For November, market participants estimate a 100% probability that the total (year-to-date) rate cut will be 50 basis points and a 94.4% probability that the total rate cut will be 75 basis points. Likewise for December, market participants estimate a 100% probability that the total rate cut will be 75 basis points and a 79.7% probability that the total rate cut will be 1% in 2024.

Five Bitcoin-Centric Stocks in Focus

Robinhood Markets Inc.

Robinhood Markets operates a financial services platform in the United States. Its platform allows users to invest in stocks, exchange-traded funds, options, gold, and cryptocurrencies. HOOD buys and sells Bitcoin, Ethereum, Dogecoin, and other cryptocurrencies using its Robinhood Crypto platform. Robinhood Markets carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Solid Price Appreciation Potential for HOOD Stock

At present, the short-term average price target of brokerage firms for the stock represents an increase of 15.9% from the last closing price of $20.64. The brokerage target price is currently in the range of $9.5-$32.

Coinbase Global Inc.

Coinbase provides financial infrastructure and technology for the crypto economy in the United States and internationally. COIN offers the primary financial account in the crypto space for consumers, a marketplace with a pool of liquidity for transacting in crypto assets for institutions, and technology and services that enable developers to build crypto-based applications and securely accept crypto assets as payment. Coinbase Global currently carries a Zacks Rank #3 (Hold).

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Astonishing Price Appreciation Potential for COIN Stock

At present, the short-term average price target of brokerage firms for the stock represents a jump of 56.9% from the last closing price of $157.15. The brokerage target price is currently in the range of $160-$345.

NVIDIA Corp.

NVIDIA is a semiconductor industry giant and one of the biggest success stories of 2023 and 2024. As a leading designer of graphic processing units (GPUs), the NVDA stock usually soars on a booming crypto market. This is because GPUs are pivotal to data centers, artificial intelligence, and the creation of crypto assets. NVIDIA currently carries a Zacks Rank #3.

Attractive Price Appreciation Potential for NVDA Shares

At present, the short-term average price target of brokerage firms for the stock represents a rise of 38.1% from the last closing price of $116.91. The brokerage target price is currently in the range of $90-$200.

Interactive Brokers Group Inc.

Interactive Brokers Group is a global automated electronic broker. IBKR executes, processes and trades in cryptocurrencies. IBKR’s commodities futures trading desk also offers customers a chance to trade cryptocurrency futures. IBKR currently carries a Zacks Rank #3.

Strong Price Appreciation Potential for IBKR Shares

At present, the short-term average price target of brokerage firms for the stock represents an increase of 13.4% from the last closing price of $122.77. The brokerage target price is currently in the range of $100-$180.

Block Inc.

Block is an online digital and mobile payment platform for consumers and merchants and is the parent company of Square and Cash App. The users of the Cash App can buy, sell, send and receive Bitcoin.

In addition, SQ’s decentralized tbd platform allows developers to build decentralized finance applications that run on programmable blockchains. SQ is also one of the largest Bitcoin investors. SQ currently carries a Zacks Rank #3.

Impressive Price Appreciation Potential for SQ Stock

At present, the short-term average price target of brokerage firms for the stock represents a surge of 41.2% from the last closing price of $63.38. The brokerage target price is currently in the range of $40-$100.

The chart below shows the price performance of above-mentioned five Bitcoin-centric stocks in the past three months.

Zacks Investment Research

Image Source: Zacks Investment Research

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