Blockchain-Exposed Stocks Could Show Massive Sales Growth Despite Recent Underperformance, Goldman Says

Bitcoin has become more correlated with equity index returns in recent months, the bank’s analysts said.

AccessTimeIconApr 7, 2022 at 11:12 a.m. UTC
Updated May 11, 2023 at 7:15 p.m. UTC
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Blockchain-exposed stocks have on average underperformed the S&P 500 by 8% year to date, falling 13% versus a 5% decline for the index, Goldman Sachs (GS) said in a note on Wednesday.

  • Despite the underperformance, median blockchain-exposed stocks are expected to increase sales at 16% annually through to 2024, compared with a 9% sales growth for median U.S. stocks, strategists led by David Kostin wrote.
  • An equal-weight portfolio of these stocks returned 3% during the 19% rally in bitcoin (BTC) since the end of January, versus a flat return for the S&P 500, the report said. These stocks exhibited a 67% correlation with bitcoin in the last six months, according to the report.
  • The bank notes that while these stocks are correlated with bitcoin, the cryptocurrency itself has become more correlated with equity index returns in recent months.
  • Goldman screened 26 U.S. stocks with blockchain and cryptocurrency exposure, and with market caps greater than $1 billion.
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