Rosenblatt reiterates Buy on Galaxy Digital stock, cites Q1 beat By Investing.com

Rosenblatt reiterated a Buy on Galaxy Digital with a $39 price target, implying about 54% upside from the current $25.35 share price. The firm pointed to better-than-expected Q1 results, a solid start to Q2 2026, 40% revenue growth over the last 12 months, and catalysts from CLARITY and HPC execution. Offset by ongoing losses, Galaxy remains unprofitable with a diluted loss of $0.61 per share, while Goldman Sachs separately kept a Neutral rating and a $21 target.

Analysis

GLXY is becoming a volatility proxy on two separate axes: crypto beta and regulatory/compute optionality. The market is still treating it as a levered crypto balance sheet, but the bigger second-order swing is that progress on policy clarity and HPC execution can re-rate the business from mark-to-market earnings to a higher-multiple infrastructure compounder, which is what the bullish target is implicitly underwriting.

The disconnect is that consensus is likely underpricing duration risk in the next 1-2 quarters while overpricing near-term mark pressure. If crypto stays range-bound, treasury marks and sentiment can keep suppressing the equity, but that pain may be temporary if operating businesses continue scaling; the more important question is whether non-treasury EBITDA can start to dominate reported results by year-end. That creates a classic setup where the stock can rally on the path to uglier headline GAAP numbers.

The main loser in the near term is the high-cost crowding of levered crypto proxies that need sustained token appreciation to justify valuation. More broadly, this is a read-through for listed crypto-adjacent names and prime brokers: stronger GLXY execution tends to pull capital toward the few platforms with product breadth, while weaker operators get compressed further as investors demand proof of fee-income durability. The market is also signaling that Goldman’s lower target may be more about reported-accounting skepticism than business quality, which leaves room for a sharp multiple catch-up if execution persists.

Key Decisions for Investors

• Long GLXY into any post-earnings volatility: 3-6 month horizon, favor scaling in on 5-8% pullbacks; reward/risk is attractive if HPC and policy catalysts remain intact and the stock re-rates toward the high-$30s.
• Buy GLXY call spreads (3-6 months, upside to ~$35-40) instead of outright equity: this captures catalyst upside while limiting drawdown if crypto marks remain choppy and headline GAAP losses keep scaring longs.
• Pair trade: long GLXY / short a weaker crypto-beta peer with less diversified revenue or thinner liquidity over 1-2 quarters; the edge is that GLXY can benefit from both volatility and operating leverage, while pure-beta names need a cleaner spot move.
• If already long, hedge with short-dated puts around known catalyst windows (Fed/earnings) rather than de-risking the core position; this preserves upside to regulatory/news catalysts while controlling gap risk.
• Stay underweight GS on the read-through: the neutral stance here reinforces that the market is still not rewarding crypto-financial exposure broadly, so treat any GLXY strength as stock-specific rather than a wholesale sector breakout.