Coinbase Global (NASDAQ:COIN) & Ellington Credit (NYSE:EARN) Critical Analysis

Ellington Credit (NYSE:EARN) and Coinbase Global (NASDAQ:COIN) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, valuation, institutional ownership, risk, profitability, dividends and analyst recommendations.

Volatility and Risk

Ellington Credit has a beta of 1.28, indicating that its share price is 28% more volatile than the S&P 500. Comparatively, Coinbase Global has a beta of 3.39, indicating that its share price is 239% more volatile than the S&P 500.

Institutional & Insider Ownership

20.4% of Ellington Credit shares are held by institutional investors. Comparatively, 68.8% of Coinbase Global shares are held by institutional investors. 1.4% of Ellington Credit shares are held by insiders. Comparatively, 16.7% of Coinbase Global shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations for Ellington Credit and Coinbase Global, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ellington Credit	0	1	1	0	2.50
Coinbase Global	3	12	19	0	2.47

Ellington Credit currently has a consensus target price of $5.50, indicating a potential upside of 29.26%. Coinbase Global has a consensus target price of $222.47, indicating a potential upside of 14.02%. Given Ellington Credit’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Ellington Credit is more favorable than Coinbase Global.

Profitability

This table compares Ellington Credit and Coinbase Global’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ellington Credit	-70.52%	N/A	N/A
Coinbase Global	-15.72%	3.12%	1.54%

Valuation and Earnings

This table compares Ellington Credit and Coinbase Global”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ellington Credit	$15.88 million	10.23	-$38.85 million	($0.98)	-4.34
Coinbase Global	$7.18 billion	7.17	$1.26 billion	($3.84)	-50.81

Coinbase Global has higher revenue and earnings than Ellington Credit. Coinbase Global is trading at a lower price-to-earnings ratio than Ellington Credit, indicating that it is currently the more affordable of the two stocks.

Summary

Coinbase Global beats Ellington Credit on 9 of the 14 factors compared between the two stocks.

About Ellington Credit

Ellington Credit Company, a real estate investment trust, acquires, invests in, and manages residential mortgage-and real estate-related assets. It acquires and manages residential mortgage-backed securities (RMBS), including agency pools and agency collateralized mortgage obligations (CMOs); and non-agency RMBS, such as non-agency CMOs, such as investment grade and non-investment grade. The company has elected to be taxed as a real estate investment trust. As a result, it would not be subject to corporate income tax on that portion of its net income that is distributed to shareholders. The company was formerly known as Ellington Residential Mortgage REIT and changed its name to Ellington Credit Company in April 2024. Ellington Credit Company was incorporated in 2012 and is based in Old Greenwich, Connecticut.

About Coinbase Global

Coinbase Global, Inc. provides financial infrastructure and technology for the crypto economy in the United States and internationally. The company offers the primary financial account in the crypto economy for consumers; and a marketplace with a pool of liquidity for transacting in crypto assets for institutions. It also provides technology and services that enable developers to build crypto products and securely accept crypto assets as payment. The company was founded in 2012 and is based in Wilmington, Delaware.