DeFi
Selling DeFi Technologies Stock Is an “Attractive Buying Opportunity,” Benchmark Says
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Benchmark said the selloff in altcoins triggered the decline in DeFi Technologies shares, and that weakness was further compounded by the publication of a negative opinion piece.
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The broker reiterated its Buy rating and C$3 price target.
The selloff in DeFi Technologies (DEFI) shares appears overdone and the stock now offers an attractive buying opportunity, Wall Street brokerage Benchmark said in a research report on Thursday, reiterating its buy rating.
Shares of the cryptocurrency exchange-traded product (ETP) issuer have fallen in recent days following sharp declines in altcoins and a negative opinion article in a crypto newsletter.
Benchmark analyst Mark Palmer wrote that the stock had gained more than 330% since the beginning of May; it then lost nearly half its value in two days before recovering much of that loss yesterday afternoon.
Most of the ETPs offered by DeFi are focused on altcoin, and the slump The purchase of these tokens earlier in the week had a negative impact on the stock price, Palmer said.
The pullback could partly be because traders took some profits after the recent outsized rally, but the selling appears overdone and the stock’s significant revaluation provides an “attractive buying opportunity,” the report added.
Palmer reiterated his buy rating on the stock and a C$3 price target. Shares fell 17% in early trading Thursday to around C$1.93 before rebounding to near C$2, according to data from TradingView.
“The volatility in altcoin prices should come as no surprise to anyone with even a cursory understanding of cryptocurrency market dynamics,” Palmer wrote, adding that some weakness in stock prices due to the selloff of these tokens was understandable.
DeFi a replied to the negative article published by CoinSnacks, describing it as a “misleading and distorted report,” the note added.
Learn more: Bitcoin and Crypto-Related Stocks Are Ripe for Institutional Adoption: Bernstein