Coinbase Shorts Hit 11% of Float as Earnings Loom

Coinbase Global goes into its October 29 earnings report with short sellers adding to positions for the second consecutive week, even as the stock trades at a meaningful discount to where most analysts have their targets.

Short interest climbed again this week. The position grew 4.3% in a single session on October 20 to reach 25.4 million shares, or 11.1% of free float. That is up 4.3% on the week and continues a rebuilding trend that began after a large covering wave unwound in late September, when shorts briefly dipped below 22 million shares. One month ago the position stood closer to 10%, so the direction of travel is clear. The borrow market, however, offers no pressure on that short base. Availability has tightened to 483% from 553% a week ago, a 13% narrowing, though the absolute level still means roughly four to five shares are available for every one currently borrowed. Cost to borrow is negligible at 0.40%, down fractionally on the week. Options are equally calm: the put/call ratio of 0.78 is fractionally below its 20-day average, a z-score of minus 0.43, nowhere near the 0.88 peak hit earlier this year. Bears are building a position, but the borrow market is not punishing them for it and options traders are not hedging aggressively into the event.

The Street is broadly constructive but scattered on price. The mean analyst target is $212, against a current price of $170.85, implying roughly 24% upside. This week, Needham raised its target to $205 from $200 while reiterating Buy. Earlier in October, Citigroup lifted to $230, Morgan Stanley moved to $258 from $250 at Equal-Weight, and Barclays raised its bear-case target all the way to $149 from $95 while keeping its Underweight rating, a sign even cautious analysts are recalibrating after the stock's autumn slide. Citizens trimmed to $280 from $325. The bull case centres on improving spot trading momentum, with September reported as Coinbase's strongest month since February, and a broadening of the business into derivatives, custody, and stablecoin infrastructure. The bear case is simpler: transaction fee revenue remains heavily dependent on retail crypto volumes, the global crypto market cap has fallen around 18% since early May, and the mix shift toward more stable revenue streams is not yet large enough to offset that drag. Factor scores underline the divide. The EPS surprise rank is in the 98th percentile, meaning the company has consistently beaten estimates, but the 30-day EPS momentum rank has collapsed to just 2, pointing to downward estimate revisions in the near term. The short score rank sits at the 19th percentile, which by itself is not alarming, but the ev/ebit rank at the 1st percentile flags how stretched the valuation looks against earnings power today.

The insider register tells a consistent story: everyone selling is doing so under a pre-arranged 10b5-1 plan. Director Marc Andreessen sold shares on September 8, September 21, October 1, and October 2 at prices ranging from $181 to $198, totalling roughly $7.8 million across those four filings. CFO Alesia Haas sold just over $7.9 million of stock on September 21 at prices around $205. All transactions carried the 10b5-1 designation, which means they were scheduled in advance rather than executed at management discretion. Net insider activity over the past 90 days totals minus $22.6 million across minus 124,000 shares. The 10b5-1 framing matters here: planned sales at a price that is now well above the current market do not carry the same signal as discretionary selling, and no buyer has emerged to offset the flow.

Earnings history gives some context for the magnitude of potential moves. The last two prints on record both involved outsized reactions, with the most recent showing a 9% move in one direction on the day. The prior result produced a 2.5% positive move. The range is wide enough that the direction of the next report is clearly not assumed by the options market, where the put/call ratio has drifted back to neutral after sitting slightly more defensive through mid-October.

The October 29 print is now eight days away. What to watch is whether September's spot volume strength translated into a revenue number that supports the revised $1.2 billion quarterly estimate, and whether management commentary on USDC and stablecoin trends moves the goalposts on the FY26 revenue outlook of $5.16 billion.