Marathon Digital Holdings, Inc. (NASDAQ: $MARA) is a major Bitcoin mining company founded in 2010. The Las Vegas, NV based company owns and operates several Bitcoin mining facilities. It also sells software and technology for use in the crypto mining ecosystem, and offers consulting services to crypto mining ventures.
On Thursday evening, May 9, 2024, Marathon Digital released its Q1 fiscal 2024 results to a disappointing market reaction after missing revenue estimates.
Marathon Digital Misses Revenue Estimates in Q1 Results
For the quarter ended March 2024, Marathon Digital reported a revenue increase of 223.3% Y/Y to $165.2 million. However, it came in below estimates of $180.7 million.
Net income in the quarter came in at $337.2 million, a 184% increase Y/Y for a diluted EPS of $1.26, beating the analysts’ estimate of $0.03.
Its first-quarter adjusted EBITDA rose 266% to $528.8 million from $144.5 million the previous year, while operating income rose 202.85% to $369.70 million.
Q1 Highlights
The improved results compared to last year were driven by increased Bitcoin production and a rise in BTC prices. During the quarter, the company increased its BTC production by 28% to 2,811 BTC, while the average price per coin increased 126% Y/Y.
Additionally, Marathon Digital increased its Energized Hash rate to 27.8 EH/s compared to 11.5 EH/s in the first quarter of fiscal 2023. It sold 26% of the BTC produced during the quarter to fund operations.
It reported 256% in gains on digital assets to $88.8 million compared to $137.4 million in Q123, driven by the rise in the price of Bitcoin from $38.474 the previous year to $71,288 as of March 31, 2024.
The company reported a 205.37% increase in operating expenses to $372.71 million compared to $122.05 million. Meanwhile, total liquidity at the end of the first quarter came in at $1.6 billion.
Marathon Digital Forecast
Commenting on the results, Marathon Digital CEO Fred Thiel said they plan to increase their energized hash rate by the end of fiscal 2024. He said, “With $1.6 billion of liquidity, we are now targeting 50 exahashes of energized hash rate by the end of 2024 and additional growth in 2025.”
MARA Stock Performance
Following the Q1 revenue miss, Marathon Digital (MARA) shares sank 8.45% during the morning trading session to $17.97 as of 09:36 AM EDT. At the close of trading, the stock was down 12.67% at $17.16.
After peaking to a high of over $31 in late February 2024, the stock price has fallen to around $18 per share, down 21.33% since the start of the year. However, the stock is still up 76.51% in the past 52 weeks.
It is currently trading at a major discount to its 52-week high of $34.09, below its 50 DMA of $19.54, and above its 200 DMA of $16.13.
The short interest in the stock has increased by 15.87% from the previous months, with short sellers holding 52.5 million MARA shares as of April 15, 2024. They hold 21.57% of the floating shares, and 19.51% of the share outstanding.
Analysts’ Outlook on MARA Stock
According to six stock analysts, MARA stock has an overall hold rating. They forecast a wide range for the stock, with a high of $35 and a low of $14.30. Their average price forecast of $21.76 is a 20.96% upside from the most recent price.
Should You Buy MARA Stock?
Marathon Digital is one of the best-known companies in the Bitcoin mining scene. Its large portfolio of BTC makes it more resilient to fluctuations in BTC prices. Additionally, it is constantly working to improve its mining capacity, which could give it an edge in the long term.
However, the volatile nature of the crypto markets makes it a riskier investment than most stocks. Despite this, BTC prices have generally been on an upward trend since it went live in 2009. As such, Marathon Digital could be a great long-term investment for investors seeking exposure to the crypto market without having to hold any crypto directly.
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