Value
8.0/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 5.2 |
| P/S | 8.1 |
| Fwd P/E | 9.1 |
| PEG | 10.0 |
| Analyst target | 7.5 |
- ▸Forward P/E: 11.2x
- ▸PEG: 0.47
- ▸Attractively valued
CCB · Why this verdict
Why Coastal Financial (CCB) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.3/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Short interest at 11% of the float — combined with an extremely call-skewed options market — creates a meaningful short squeeze risk if the stock receives a positive earnings catalyst or a technical breakout above the 200-day moving average. Key risks | Short interest falls below 5% as short sellers cover positions, reducing the overhang and allowing the stock to move more freely toward the analyst target. | →Stable |
| CounterHigh short interest in a stock with a consistent miss history typically reflects informed bearish conviction rather than speculative positioning; the elevated short base may prove well-founded if the earnings pattern does not improve. | ||
With approximately 27% upside to the analyst consensus price target of $90.31 against roughly 6% near-term downside, the risk/reward ratio of approximately 4-to-1 in favor of the long side represents an asymmetric setup that clears the minimum required threshold. Engine gate (passed) | The stock approaches the $90 analyst target over the next 12 months as execution improves and the price gap closes. | →Stable |
| CounterA favorable risk/reward ratio is a geometric observation about where the stock is relative to targets, not a guarantee of delivery; if earnings continue to disappoint and analysts revise targets downward, the upside case compresses quickly. | ||
The stock is below its 200-day moving average with the moving average slope declining at approximately 5% over the past 30 days, accompanied by falling on-balance volume and a hard death-cross technical block — all signals consistent with a confirmed price downtrend. Momentum breakdown | The downtrend reverses when the stock closes above its 200-day moving average for 10 consecutive trading sessions and the moving average slope turns positive. | →Stable |
| CounterThe MACD is improving and the RSI is at a neutral 49, which can precede a recovery; the technical deterioration may be losing momentum even if the trend confirmation has not yet arrived. | ||
Three of the last four quarters missed consensus estimates, including the two most recent at -24.8% and -19.3% respectively, producing an average earnings shortfall of approximately 14.7% — a pattern that suggests either structural underperformance or a persistent mismatch between analyst expectations and the business's actual trajectory. Earnings | EPS surprise turns positive, exceeding 0% for 2 consecutive quarters, signaling that the miss cycle has broken. | →Stable |
| CounterThe one quarter in the four-period window that came in on the positive side was a near-beat of 0.9%, suggesting the company can occasionally meet expectations; if the large misses reflect idiosyncratic timing items rather than underlying business deterioration, a reversion to in-line delivery could arrive abruptly. | ||
A forward price-to-earnings multiple of 10.1 times, a price-to-earnings-to-growth ratio of 0.43, and a Piotroski financial health score of 8 out of 9 indicate that the balance sheet is fundamentally sound and the stock is priced well below what the earnings growth trajectory would ordinarily command. Valuation breakdown | The forward multiple expands above 14 times over the next four quarters as earnings recover and the valuation discount closes toward the peer group. | →Stable |
| CounterA strong Piotroski score reflects balance-sheet mechanics, not earnings predictability; with three consecutive misses, the earnings base on which the favorable multiple rests may be overstated, making the apparent cheapness misleading. | ||
Short interest at 11% of the float — combined with an extremely call-skewed options market — creates a meaningful short squeeze risk if the stock receives a positive earnings catalyst or a technical breakout above the 200-day moving average.
→StableKey risks
- Expectation
- Short interest falls below 5% as short sellers cover positions, reducing the overhang and allowing the stock to move more freely toward the analyst target.
CounterHigh short interest in a stock with a consistent miss history typically reflects informed bearish conviction rather than speculative positioning; the elevated short base may prove well-founded if the earnings pattern does not improve.
With approximately 27% upside to the analyst consensus price target of $90.31 against roughly 6% near-term downside, the risk/reward ratio of approximately 4-to-1 in favor of the long side represents an asymmetric setup that clears the minimum required threshold.
→StableEngine gate (passed)
- Expectation
- The stock approaches the $90 analyst target over the next 12 months as execution improves and the price gap closes.
CounterA favorable risk/reward ratio is a geometric observation about where the stock is relative to targets, not a guarantee of delivery; if earnings continue to disappoint and analysts revise targets downward, the upside case compresses quickly.
The stock is below its 200-day moving average with the moving average slope declining at approximately 5% over the past 30 days, accompanied by falling on-balance volume and a hard death-cross technical block — all signals consistent with a confirmed price downtrend.
→StableMomentum breakdown
- Expectation
- The downtrend reverses when the stock closes above its 200-day moving average for 10 consecutive trading sessions and the moving average slope turns positive.
CounterThe MACD is improving and the RSI is at a neutral 49, which can precede a recovery; the technical deterioration may be losing momentum even if the trend confirmation has not yet arrived.
Three of the last four quarters missed consensus estimates, including the two most recent at -24.8% and -19.3% respectively, producing an average earnings shortfall of approximately 14.7% — a pattern that suggests either structural underperformance or a persistent mismatch between analyst expectations and the business's actual trajectory.
→StableEarnings
- Expectation
- EPS surprise turns positive, exceeding 0% for 2 consecutive quarters, signaling that the miss cycle has broken.
CounterThe one quarter in the four-period window that came in on the positive side was a near-beat of 0.9%, suggesting the company can occasionally meet expectations; if the large misses reflect idiosyncratic timing items rather than underlying business deterioration, a reversion to in-line delivery could arrive abruptly.
A forward price-to-earnings multiple of 10.1 times, a price-to-earnings-to-growth ratio of 0.43, and a Piotroski financial health score of 8 out of 9 indicate that the balance sheet is fundamentally sound and the stock is priced well below what the earnings growth trajectory would ordinarily command.
→StableValuation breakdown
- Expectation
- The forward multiple expands above 14 times over the next four quarters as earnings recover and the valuation discount closes toward the peer group.
CounterA strong Piotroski score reflects balance-sheet mechanics, not earnings predictability; with three consecutive misses, the earnings base on which the favorable multiple rests may be overstated, making the apparent cheapness misleading.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Coastal Financial Corporation offers a favorable risk/reward geometry of roughly 4-to-1 with 27% upside to the analyst consensus target, but the stock is in a confirmed downtrend with three large earnings misses and elevated short interest — the asymmetry is real, yet the path to realizing it requires a reversal in execution and price momentum that has not yet materialized.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.4 |
| ROA | 0.7 |
| Gross margin | 0.0 |
| Op margin | 6.2 |
| Net margin | 6.8 |
| Moat | 5.4 |
| Piotroski F | 8.9 |
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 8/9
Growth
6.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.8 |
| EPS growth | 6.8 |
Momentum
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.3 |
| MACD | 10.0 |
| OBV | 4.7 |
| MA position | 6.0 |
| Volume | 2.5 |
- ▸Below 200-MA, MA slope -5.3%/30d — confirmed downtrend
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 8.9 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 36%
Insider
3.9/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 5.1 |
- ▸Modest insider selling — $754,014 (0.063% of mkt cap)
Peer rank
4.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.2 |
| quality rank | 2.6 |
| growth rank | 6.1 |
Technical
2.1/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.1 |
| support resistance | 2.0 |
| 52w position | 3.1 |
Risk (lower is worse)
4.1/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 4.4 |
| days to cover | 0.0 |
| volatility | 5.0 |
| put call | 3.0 |
| implied vol | 3.8 |
| beta | 8.7 |
- ▸Elevated put/call: 1.56
- ▸Concentration risks: 1 HIGH, 3 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
2.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
- ▸Earnings concerns: 1B/3M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:5.3>=4.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:26d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:1.3<1.5@spot
- FINSVC_REGIONAL_CLIFF:HARD_BLOCK
Warning (2)
- MOMENTUM:5.3<5.5 (soft — BUY_NOW allowed but watch)
- DEATH_CROSS:momentum=5.3>=5.0 recovering
Reward-to-Risk
1.27
Upside
+15.3%
Downside
12.0%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 67
EdgeInst Constrain — Small cap ($1.2B) below institutional reach
SuitabilityAggressive — MCap $1.2B<$5B
Investment implication
The F-path SELL output reflects an overall score of 5.3 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 8.0) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:1.3<1.5@spot, FINSVC_REGIONAL_CLIFF:HARD_BLOCK) reinforce the read. Current asymmetry R:R is 1.27 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 8.0, Growth at 6.8, and Sentiment at 6.3; the weakest are Technical at 2.1, Catalyst at 2.5, and Insider at 3.9. The V9 engine flagged 2 failed gates with 2 warnings, producing an asymmetric reward-to-risk of 1.27 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Substantial Analyst Upside Favorable Rr
Trip ifAnalyst consensus price target falls below $78, reducing potential upside to less than 10% from the current level.
- P2Confirmed Downtrend Technical Block
Trip ifStock closes above its 200-day moving average for 10 consecutive trading sessions and the moving average slope turns positive.
- P3Consecutive Large Earnings Misses
Trip ifEPS surprise turns positive, exceeding 0% for 2 consecutive quarters.
- P4High Short Interest Squeeze Risk
Trip ifShort interest falls below 5% of float as short sellers cover positions.
- P5Valuation Discount Piotroski Strength
Trip ifForward P/E expands above 16x as earnings estimates are revised materially downward.