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The past few years haven’t exactly been rewarding for Tiger Cub and billionaire Chase Coleman and his hedge fund, Tiger Global. The fund lost 7% in 2021 and another 56% in 2022 before returning 28.5% in 2023. Still, the fund is tech-centric and underperformed by a wide margin compared to the Nasdaq 100’s 2023 return of 55.1%, which marked its best return since 1999.
Disappointment in the Air
Tiger Global operates as a concentrated long/short fund. As of Dec. 31, 20 it had a 13F assets under management (AUM). Its top 10 positions make up 71.59% of its 13F portfolio, while it has an average holding period of 11.36 quarters, or 2.84 years.
Unfortunately for Tiger Global, the fund sold out of all of its 38,850 shares of Coinbase (NASDAQ:COIN) during the fourth quarter. Coinbase recently reported its fourth-quarter earnings, propelling its year-to-date return to about 20%. Tiger Global first bought shares of COIN stock in Q2 of 2021.
Behind the Numbers
During the fourth quarter, Coinbase reported its first quarterly profit in two years, or since Q4 of 2021. Revenue tallied in at $953.8 million, up by 51% year-over-year and beating the analyst estimate for $826 million by a significant 15.47%. Diluted earnings per share (EPS) was $1.04, up from a diluted EPS loss of $2.46 a year ago and beating the analyst estimate for 2 cents. These strong results were led by a resurgence of interest and price in Bitcoin (BTC-USD) and Ethereum (ETH-USD).
Bright Future Ahead?
“All told, Coinbase is a fundamentally stronger company today than a year ago, and we are in astrong financial position to capitalize on the opportunities ahead,” said Coinbase in its Q4 shareholder letter.
Wall Street analysts were impressed with the numbers too. Wedbush raised its price target to $200 from $180, while Needham raised its target to $220 from $180. CFRA raised its target to $177, adding that the strong price action of cryptocurrencies should offset any potential regulatory risks in the near term. The research firm also noted that the Bitcoin halving event in April could be a potential catalyst for COIN stock.
