Despite the muted enthusiasm around cryptocurrencies such as Bitcoin (USD-BTC) these past few weeks following the Bitcoin spot ETF approval, some blockchain stocks with growth potential could reignite investors’ bullish sentiment.
These blockchain stocks are highly rated by Wall Street, with some analysts anticipating double-digit growth for the EPS and revenue figures for these businesses in the future. Much of this optimism may come in the wake of new liquidity being injected into the market from institutions as time moves on — a consequence of the Bitcoin spot ETF approval we saw recently.
Other tailwinds that could power the returns of these firms include the wider acceptance of cryptocurrencies as a valid investment. Research unveiling facts like these coins being able to improve a portfolio’s risk-adjusted returns may be appealing to the majority of investors.
So here are some blockchain stocks with growth potential for investors to consider.
Coinbase (COIN)
Coinbase (NASDAQ:COIN) remains a major player in the blockchain and cryptocurrency exchange market. It also plays a key role in the administration of Bitcoin spot ETFs. Specifically, it is listed in the SSA Surveillance Sharing Agreement (SSA) role in of 8 out of 11 firms that have applied for spot BTC ETF approvals.
COIN also plays a role in the facilities of custody and finance of these ETFs, which makes the company strongly positioned in the future.
Although Wall Street currently rates COIN as a ‘Hold,’ analysts are very bullish on the prospect for its fundamentals to improve. Notably, revenue is expected to surge 16.87% in FY2024, while its EPS is predicted to increase from -81 cents to -19 cents.
This makes COIN one of those blockchain stocks with growth potential.
Riot Blockchain (RIOT)
Riot Blockchain (NASDAQ:RIOT) focuses on cryptocurrency mining, primarily Bitcoin. It’s one of the largest crypto mining operations in North America.
The company’s stock is up 91.08% over the past year, and things look like they could be even more accretive for investors. A further upside of 44.58% is expected over the past year, and Wall Street rates it as a “Strong Buy.”
A 61.33% top-line increase is expected for FY2024, while EPS is also expected to increase as the brand edges toward profitability.
One of the key reasons I’m bullish on RIOT is due to its improving top and bottom lines, but also that its book value per share may increase substantially amid the Bitcoin halving event that will occur in April.
RIOT holds 7,362 Bitcoins with a market value of $310,011,317. As Bitcoin tends to rally before and after the halving event takes place, we could see a substantially stronger balance sheet for RIOT, which could cause some investors to surmise that it’s undervalued based on the assets on its balance sheet.
RIOT is then one of those blockchain stocks with growth potential.
Nvidia (NVDA)
Despite Nvidia’s (NASDAQ:NVDA) premium valuation at around 80 times sales, I think it’s important to put this in context with its growth potential. And a substantial amount of that growth predicted to come from the blockchain industry.
NVDA stock’s GPUs are crucial for cryptocurrency mining, which is an integral part of blockchain networks like Bitcoin and Ethereum (ETH-USD). There are also more cryptocurrencies released every day that support GPU mining, and I expect that this trend will accelerate in the future as the awareness of the cryptocurrency industry spreads and becomes more accessible.
Although falling considerably short of last year’s astronomical leap in EPS (621.54%), FY2024 also looks to be very attractive on the EPS front for NVDA. Analysts expect that its EPS will climb 67.57% during this period and that it will continue to increase by low double-digit amounts until 2028.
Investors, therefore, should keep a close eye on NVDA.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.