Cryptocurrencies are hot again this year, and so are companies specializing in blockchain technology that underpins and supports digital coins and tokens. After enduring what came to be known as the “crypto winter” last autumn following the $8 billion collapse of cryptocurrency exchange FTX, digital assets have staged a comeback, with the price of Bitcoin (BTC-USD), the largest cryptocurrency by market capitalization, having risen 78% since January. The rebound has propelled many companies associated with cryptocurrencies and blockchain technology sharply higher as a result. Some blockchain stocks have more than doubled year to date. Others are testing new all-time highs. This upsurge has made crypto a good sector for investors to revisit. Especially as there continue to be buying opportunities in the space. Here are three blockchain stocks nearing super attractive entry points.
Coinbase Global (COIN)
After a punishing selloff in 2022, cryptocurrency exchange Coinbase’s (NASDAQ:COIN) stock is up an incredible 180% this year. But even with that epic climb, COIN stock remains nearly 20% below its 52-week high. And the stock is trading 73% lower than the all-time high it reached in November 2021 when the stock market and crypto mania reached their respective peaks. That means COIN still presents an opportunity to invest and ride on its way back up.
Coinbase is scheduled to report its second-quarter results on August 3, and analysts are looking for the company to build on the progress it made with its Q1 print. For the first three months of the year, Coinbase reported its revenue increased 23% from a year ago to $773 million. That was better than the $655 million expected on Wall Street, according to data from FactSet. Coinbase also announced a net loss of 34 cents a share, much better than the $1.45 predicted loss from Wall Street. Can the company beat estimates again in Q2?
Block (SQ)
Shares of Block (NYSE:SQ) took a big hit this spring when notorious short-seller Hindenburg Research published a report alleging that the company inflates its Cash App user numbers and takes a “Wild West” approach to its compliance and internal control systems. SQ stock immediately plunged 15% on news of the Hindenburg report and continued sliding until mid-May. However, after bottoming at $55 a share, the stock has reversed higher, gaining 42%.
The upswing in SQ stock follows a strong response by Block, formerly known as Square, to the Hindenburg report. Block has also recovered due to improving investor sentiment towards cryptocurrencies and decent earnings. The company posted Q1 revenue of $4.99 billion, up 26% from a year earlier and ahead of analyst expectations for $4.59 billion. Gross profit in Q1 rose 32% to $1.71 billion. Block’s stock has been relatively flat over the last 12 months but is currently trading 15% below its 52-week high, presenting a buy-the-dip opportunity.
MicroStrategy (MSTR)
MicroStrategy (NASDAQ:MSTR) isn’t a pure blockchain company. Its bread-and-butter is as a software developer for business intelligence and cloud-based services. However, the company is a major holder of Bitcoin, currently owning more than $4 billion worth of the cryptocurrency. As the price of BTC has rallied 75% this year, it has boosted MSTR stock big time. Year to date, MicroStrategy’s share price has increased 200%.
Even with the amazing run this year, MSTR is still not testing a new 52-week high. The company’s share price is nearly 9% below its peak over the last 12 months and 58% below the high it hit in February 2021 during the crypto frenzy. While the stock has run far in recent months, it could still have more gas in the tank. The company just announced Q2 results that showed it bought an additional 12,800 bitcoins during the period at a cost of $361.4 million, lifting its stake to $4.53 billion. MicroStrategy is clearly committed to digital coins and tokens.
On the date of publication, Joel Baglole did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
