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On Wednesday, Cantor Fitzgerald initiated coverage on Coincheck Group N.V. (NASDAQ:CNCK) with an Overweight rating and a 12-month price target of $10.00, representing significant upside from its current price of $7.27. The firm highlighted Coincheck’s potential in the Japanese market and its position as the second-largest cryptocurrency exchange in Japan. InvestingPro data shows the stock has experienced high price volatility, trading between $6.55 and $14.99 over the past 52 weeks. The analyst commended the company for its strong cybersecurity measures post-acquisition by Monex Group in 2018 and noted the absence of further security breaches since then.
Coincheck, which only operates within the Japanese market, is seen as an attractive investment due to several factors, despite current financial challenges. The company’s gross profit margin stands at just 3.88%, and it has not been profitable over the last twelve months. Analysts at Cantor Fitzgerald anticipate that Japan will introduce more crypto-friendly tax legislation, which they believe will boost cryptocurrency adoption rates in the country. Furthermore, Coincheck is expected to implement a roll-up strategy that could significantly enhance its earnings.
The exchange’s profitability and its strong market position in Japan were emphasized as key attributes. The analysts also mentioned the ongoing cryptocurrency bull market, which they expect to continue until mid-2026, as a positive influence on Coincheck’s prospects.
However, the firm cautioned that some downward pressure on share prices might persist in the short term due to potential de-SPAC overhang. Despite this, Cantor Fitzgerald is optimistic about the management’s long-term strategy and believes the current share prices offer a favorable risk/reward balance, noting that Coincheck’s shares are trading at a 75% discount compared to its largest peer, Coinbase (NASDAQ:COIN). According to InvestingPro analysis, the stock appears slightly undervalued at current levels, though investors should note the company’s WEAK overall Financial Health Score. Subscribers to InvestingPro can access additional insights, including 6 key ProTips and comprehensive financial metrics to better evaluate this investment opportunity.
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