On Monday, Bernstein, maintained its Market Perform rating on Marathon Digital Holdings (NASDAQ:MARA), a prominent player in the cryptocurrency mining industry. The firm's analyst has reiterated a price target of $23.00 for Marathon Digital's shares.
The analyst's statement highlighted the company's Market Perform rating, which is based on a preference for Marathon Digital's competitors that possess more extensive Bitcoin self-mining infrastructure. Despite this, the analyst noted that Marathon Digital's year-to-date underperformance, coupled with the robustness of its Bitcoin balance sheet, suggests a significant potential for stock price appreciation from its current level, estimating approximately 43% upside to the price target.
The valuation model used by Bernstein, a Discounted Cash Flow (DCF) analysis, forecasts an Enterprise Value to FY'25E EBITDA multiple of around 7.1 times. This valuation reflects adjustments made in response to Marathon Digital's recent financial results and the prevailing price of Bitcoin.
In other recent news, Marathon Digital Holdings reported a net loss of $200 million in Q2 2024, despite a 78% increase in revenue to $145 million. The company also announced plans to offer $250 million in convertible senior notes due 2031, aiming to use the proceeds for purchasing additional bitcoin and for general corporate purposes. Cantor Fitzgerald initiated coverage on Marathon Digital stock with an Overweight rating, while Macquarie started coverage with an Outperform rating.
Marathon Digital also reported an uptick in its bitcoin mining operations, with a 5% growth in its energized hash rate and a 6% month-over-month increase in the number of blocks won. The company now holds 26,842 BTC, having chosen not to sell any bitcoin during the reported month.
In other recent developments, Marathon Digital expanded its board of directors with the appointment of Janet George and Barbara Humpton, and the designation of Doug Mellinger as lead independent director. These appointments are expected to strengthen the board's oversight capabilities and contribute to Marathon Digital's leadership in the digital infrastructure technology sector.
InvestingPro Insights
Recent data from InvestingPro provides additional context to Bernstein's analysis of Marathon Digital Holdings (NASDAQ:MARA). The company's market capitalization stands at $4.74 billion, with a P/E ratio of 13.25, suggesting a potentially attractive valuation relative to its earnings. This aligns with an InvestingPro Tip indicating that MARA is trading at a low P/E ratio relative to its near-term earnings growth.
InvestingPro data reveals impressive revenue growth, with a 224.69% increase over the last twelve months as of Q2 2024, and a 77.52% quarterly growth in Q2 2024. This robust growth supports another InvestingPro Tip that analysts anticipate sales growth in the current year. The company's profitability is also noteworthy, with a gross profit margin of 43.56% and an operating income margin of 12.16% over the last twelve months.
Despite these positive indicators, investors should note that MARA's stock price movements are quite volatile, as highlighted by an InvestingPro Tip. This volatility is evident in the company's price performance, with a strong 108.56% return over the past year, but a -31.55% return year-to-date.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for MARA, providing a deeper understanding of the company's financial health and market position.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.