Buy 5 Crypto-Centric Stocks Likely to Gain Big From Bitcoin Rally
On Jan 16, Bitcoin (BTC), the largest cryptocurrency globally, closed at $101,435.85. Bitcoin recorded its all-time high of $108,268.45 on Dec 17. Bitcoin’s north-bound journey will continue in the near-term following President-elect Donald Trump’s crypto-friendly policies and a low-interest rate regime adopted by the Fed.
At this stage, we recommend five crypto-centric stocks for investment purpose. These are – NVIDIA Corp. NVDA, Coinbase Global Inc. COIN, Robinhood Markets Inc. HOOD, Riot Platforms Inc. RIOT and Interactive Brokers Group Inc. IBKR.
Bitcoin has rallied since Donlad Trump became the President-elect on Nov 5. Trump committed several crypto-friendly policies in his election rallies. On Jan 20, Trump will take the oath as the 47th President of the United States.
On Dec 4, Donald Trump posted on social media that he plans to nominate former SEC Commissioner Paul Atkins to head the agency again. Atkins will succeed the incumbent Commissioner Gary Gensler, widely known for his strong negative view on the digital currency space.
During his election speech, Donald Trump said he would enact a strategic national crypto stockpile to ensure that the federal government never sells off its Bitcoin holdings. In June, Trump posted on social media “If crypto is going to define the future, I want it to be mined, minted and made in the USA.”
Trump posted “Biden’s hatred of Bitcoin only helps China, Russia, and the Radical Communist Left. We want all the remaining Bitcoin to be MADE IN THE USA!!! It will help us be ENERGY DOMINANT!!!”
A low interest rate is beneficial for high growth-oriented industries such as technology, consumer discretionary and cryptocurrency. The Fed reduced the benchmark lending rate by 1% to 4.25-4.5% in 2024.
The Fed has indicated two more rate cuts of 25 basis points each in 2025. However, market participants are optimistic that the number of rate cuts may increase supported by a dwindling inflation rate. The two inflation-gauge, the producer price index (PPI) and the consumer price index (CPI), especially the core CPI, were lower than expected in December.
These five stocks have strong potential for 2025. Each of our picks carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The chart below shows the price performance of our five picks in the past year.
Zacks Investment Research
Image Source: Zacks Investment Research
Zacks Rank #2 NVIDIA is a semiconductor industry giant and one of the biggest success stories of 2023 and 2024. As a leading designer of graphic processing units (GPUs), the NVDA stock usually soars on a booming crypto market. This is because GPUs are pivotal to data centers, artificial intelligence, and the creation of crypto assets.
NVIDIA has an expected revenue and earnings growth rate of 48.7% and 43.1%, respectively, for next year (ending January 2026). The Zacks Consensus Estimate for next-year earnings has improved 1% over the last seven days.
Zacks Rank #1 Coinbase Global provides financial infrastructure and technology for the crypto economy in the United States and internationally. COIN offers the primary financial account in the crypto space for consumers, a marketplace with a pool of liquidity for transacting in crypto assets for institutions, and technology and services that enable developers to build crypto-based applications and securely accept crypto assets as payment.
Moreover, COIN offers one of the most user-friendly platforms for investors because of its straight-forward user interface and simple buying process. Coinbase also provides more sophisticated trading features for experienced users, including a professional trading platform and staking, which allow users to earn rewards for holding specific cryptocurrencies.
Coinbase Global has a return on equity (ROE) of 14.81% compared with the industry ROE of 12.92% and the S&P 500 ROE of 16.84%. COIN has a current net margin of 29.76% compared with the industry’s net margin of 4.90% and the S&P 500’s net margin of 12.45%. The Zacks Consensus Estimate for 2025 earnings has improved 11.2% over the last 30 days.
Robinhood Markets operates a financial services platform in the United States. Its platform allows users to invest in stocks, exchange-traded funds, options, gold, and cryptocurrencies. HOOD buys and sells Bitcoin, Ethereum, Dogecoin, and other cryptocurrencies using its Robinhood Crypto platform.
Robinhood Markets has an expected revenue and earnings growth rate of 24.5% and 19.3%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 11.2% over the last 30 days.
Zacks Rank #2 Riot Platforms operates as a bitcoin mining company in North America. RIOT operates through three segments: Bitcoin Mining, Data Center Hosting, and Engineering. RIOT also provides co-location services for institutional-scale bitcoin mining companies, critical infrastructure and workforce for institutional-scale miners to deploy and operate their miners, operation of data centers; and maintenance/management of computing capacity.
Riot Platforms has a return on equity (ROE) of 2.15% compared with the industry ROE of -10.43% and the S&P 500 ROE of 16.88%. RIOT has a current net margin of 16.67% compared with the industry’s net margin of -11.44% and the S&P 500’s net margin of 12.45%. The Zacks Consensus Estimate for 2025 earnings has improved 2% over the last 30 days.
Zacks Rank #2 Interactive Brokers Group is a global automated electronic broker. IBKR executes, processes and trades in cryptocurrencies. IBKR’s commodities futures trading desk also offers customers a chance to trade cryptocurrency futures.
Interactive Brokers Group has an expected revenue and earnings growth rate of 0.2% and 4.4%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2.3% over the last 30 days.
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