According to CoinDesk, digital asset financial services firm Galaxy Digital has experienced significant sequential growth across its three operating units. This growth is attributed to improved crypto market conditions in anticipation of the approval of spot bitcoin (BTC) exchange-traded funds (ETFs), according to a research report by Stifel Canada analyst Bill Papanastasiou on Tuesday. Papanastasiou noted that the strong performance has continued into the current quarter, with spot prices, volumes, and volatility remaining elevated in Q1/24. The ETF launch approvals are expected to open the door to new pools of capital.
Stifel has a buy rating on the Toronto-listed company, headed by Mike Novogratz, with a C$20 price target. At the time of publication, the stock was trading 5% lower at around C$13.67, but shares have risen over 30% year-to-date. The report suggests that Galaxy Digital should be a core holding for equity investors seeking exposure to the broad digital asset ecosystem, given its attractive asymmetric return profile across diverse revenue-producing operating segments and longer-term outsized growth potential through its infrastructure solutions arm.
Galaxy is expected to perform strongly for the full year 2024, given improved crypto market sentiment following the Securities and Exchange Commission’s (SEC) approval of spot bitcoin ETFs and other tailwinds. The company reported a net income of $296 million for 2023, following a year-earlier $1 billion loss.