Riot Platforms (NASDAQ: RIOT) is a digital infrastructure and Bitcoin mining company with a market cap of $2.592 billion. It has implemented a vertically integrated strategy in its operations, making it one of the biggest BTC mining firms in the US. Its largest mining facility is in Rockdale, TX, with plans to build a bigger facility in Corsicana.
Earnings Report
Riot Platforms released its Q3 2023 earnings report on November 7, 2023. It reported a revenue of $51.9 million and a new record Hash Rate capacity of 10.9 EH/s. The reported revenue represented a year-over-year growth of 12.1% compared to Q3 2022, when it reported $46.3 million in revenue.
The company reported an EPS of -$0.25, beating the analysts’ estimate of -$0.29 by 13.79%. In Q4 2023, analysts predict an EPS of -$0.28, a decline of 300% year-over-year.
Riot Platforms attributed the revenue growth to a 6% rise in BTC production compared to Q3 2022. Additionally, the higher price of BTC at an average of $28,230 per coin for Q3 led to a revenue rise. For Q3, the average price of BTC was 33% higher compared to the same period last year.
BTC Production
The company produced 1,106 BTC in Q3, compared to 1,042 BTC in Q3 2022. Its increased deployment of miners drove the increased BTC production. It reported an average cost to mine BTC of -$6,141, compared to $8,227 per BTC at the same time last year.
For Q3, the company earned a BTC mining revenue of $31.2 million, higher than the $221 million reported in Q3 2022. Its Data Center Hosting revenue grew to $5.1 million in the quarter, lower than the $8.1 million reported a year ago. Engineering revenue was $15.5 million for Q3 2023, lower than the $15.8 million reported in Q3 2023.
Financial Health And Outlook
Riot Platforms reported a healthy financial position with $442.3 million in working capital, which includes $290.1 million in cash on hand and 7,327 in unencumbered BTC, worth around $197.6 million based on the price of BTC on September 30, 2023.
In its forecast section, the company expected a hash rate capacity of 12.5 EH/s in Q4 2023. This was due to Building G, damaged during the Texas winter storm, returning online. By the end of 2023, the company expects Building G to return to its full capacity of 2.4 EH/s.
The company said that once its Corsicana facility is at full capacity in mid-2024, its total hash rate capacity will reach 20.2 EH/s.
Riot Platforms Stock Performance
RIOT stock has had a great run in 2023. It is up 272.11% year-to-date. However, the stock has been highly volatile throughout the past twelve months, with a 52-week range of $3.25 – $20.65. The stock is trading at $12.55 per share, losing 3.46% of its value at the close of the last trading session on November 30, 2023. However, it is up 2.07% in early trading on December 1, 2023. trading.
RIOT Stock Forecast
Analysts have given Riot Platforms stock a strong buy rating. Their highest price target is $23, and the lowest is $7.50. Its average price target is $16.51, an upside of 31.55% based on the most recent closing price of $12.55.
Should You Buy RIOT Stock
Riot Platforms projects it will increase its hash rate capacity in the coming months. Consequently, it will boost its revenue. Based on the ongoing crypto market rally, the company could post a positive P/E ratio for Q4 2023 and Q1 2024. Consequently, the strong buy rating for the stock is accurate.
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