Morgan Stanley downgrades COIN to "Underweight," expects crypto trading to potentially stagnate further following the Binance attack.

BlockBeats news, November 2 - According to CNBC, Morgan Stanley downgraded the cryptocurrency trading platform Coinbase (COIN) stock rating from equal-weight to underweight, and significantly cut its target price from $258 to $120, implying about 16% downside from last Friday's close.

Analyst Michael Cyprys said in a Monday client note that the company is still advancing a broader strategy, but recent weakening trading trends, softer forward revenue outlook, and uncertain crypto market prospects make the "earnings recovery" narrative harder to sustain.

Cyprys pointed out that Coinbase's crypto trading had already weakened in October, with fourth-quarter trading revenue of about $165 million as of October 25, which at this pace would be about $607 million for the full year, roughly 11% below the market consensus of about $685 million. COIN shares have fallen about 22% over the past month. After competitor Binance suffered a hack of about $6 billion in scale last week, crypto trading may further stall, dragging down Coinbase's earnings and share price. Morgan Stanley has cut its Coinbase 2027 revenue forecast by 28% and its adjusted EBITDA forecast by 47%.

The rating runs counter to mainstream Wall Street views: LSEG data shows that of 41 analysts covering Coinbase, 26 rate it buy or strong buy, and 13 rate it hold.