These companies benefit from blockchain technology.
Many investors are familiar with blockchain as the underlying technology that provides security and transparency in the cryptocurrency market. Blockchain technology has a wide range of applications outside of crypto, however, including decentralized finance, international payments, auditing and regulatory compliance. A growing number of companies specialize in blockchain technology, have incorporated blockchain into their businesses or benefit directly from cryptocurrency usage. Unfortunately, the extreme volatility of the cryptocurrency market makes many of these companies high-risk investments that may not be suitable to every investor. Here are seven high-quality blockchain stocks to buy that Wall Street analysts recommend.
Coinbase Global Inc. (ticker: COIN)
Investors and analysts may not agree on which cryptocurrencies will ultimately take over as the world's preferred digital currencies or which companies will successfully build a shared virtual environment called the metaverse. Analysts see crypto, blockchain and the metaverse as three of the largest general growth themes in technology, however, and leading cryptocurrency exchange Coinbase can benefit from all three. CFRA Research analyst David Holt says Coinbase may even exceed high investor expectations given the long-term growth outlook for the "cryptoeconomy" and the potential for Coinbase to diversify into additional financial products. CFRA has a "buy" rating and a $405 price target for COIN stock, which closed at $191.97 on Jan. 21.
Nvidia Corp. (NVDA)
Nvidia designs and produces high-end graphics cards and processing chips for personal computers, servers and supercomputers. Bank of America analyst Vivek Arya says Nvidia will play a central role in supplying the processing power for the metaverse and its digital economy. Nvidia also produces specialized chips designed specifically for cryptocurrency mining, providing additional blockchain exposure. Arya says the metaverse is the latest multibillion-dollar opportunity for Nvidia, which is also heavily exposed to massive growth markets of artificial intelligence, online gaming, cloud computing and next-generation automobiles. Bank of America has a "buy" rating and a $375 price target for NVDA stock, which closed at $233.74 on Jan. 21.
PayPal Holdings Inc. (PYPL)
Digital payments specialist PayPal is fully embracing cryptocurrency and blockchain technology. Not only can users buy and sell crypto in their PayPal accounts, but PayPal is also reportedly exploring the launch of its own stablecoin that would be backed by the U.S. dollar. Bank of America analyst Jason Kupferberg says he is bullish on the company's "super app" strategy and says the stock's long-term upside will be tied to the potential success of its growth initiatives, including crypto, Venmo monetization and buy-now-pay-later service.
International Business Machines Corp. (IBM)
Enterprise technology leader IBM has struggled to update its legacy business model and generate consistent growth, but recent investments in blockchain technology could play a significant role in the company's future. IBM Blockchain provides services that improve security and transparency for supply chains, international payments, global trade and food supply.
