Investment bank DA Davidson has raised its price target for Coinbase shares ahead of its listing next week from $195 to $440, keeping its "buy" rating on the shares. 

The revised price target was published in a note to clients yesterday in the wake of first-quarter earnings for 2021 released by Coinbase on April 6. The largest U.S. cryptocurrency exchange will list its shares publicly on April 14 under the ticker COIN.  

Coinbase's stellar earnings triggered the price revision, according to DA Davidson's note. The numbers "far exceeded" the analysts' expectations while expenses were lower than projected, the note said. 

"We continue to believe COIN's product experience and best-in-class compliance and regulatory controls should provide a defensible moat," the DA Davidson analysts wrote. 

The analysts had estimated $614 million of revenue for the quarter, which contrasted with the $1.8 billion reported by the firm, an increase of three-fold. 

Coinbase reported earnings before interest, taxes, depreciation and amortization of $1,1 billion, which was nearly 10 times higher than DA Davidson's expectations. 

The revised price target reflects a multiple of 20 times Coinbase's revenue for the year. The analysts forecast Coinbase to register $4.4 billion in revenue in 2021. 

The note's lead author, Gil Luria, told CoinDesk the estimates implied a Coinbase market capitalization of $90 billion. This is lower than the $100 billion or more that Coinbase is thought to be worth based on private-market trading of its shares.

DA Davidson noted that Coinbase's results are tightly linked to Bitcoin's price. As a result, a downturn in Bitcoin's price would be a risk to the firm's revenues. 

"It is no question that Coinbase's revenue is highly correlated to Bitcoin," the analysts wrote. 

The analysis concluded that it believed Coinbase management understood the risks, and that its stated strategy of investing in the firm during upswings in cryptocurrency markets would help it see out the downturns.