Marathon Digital Holdings, Inc. (NASDAQ: MARA) is a company that mines blockchain-based digital assets. The company classifies cryptocurrency from its mining operations as revenue. The faster it can mine crypto, the more revenue it generates. It also sells its mined digital assets as an additional revenue stream.
Marathon Digital to Acquire Mining Facilities
On Tuesday, December 19, 2023, Marathon Digital revealed that it had signed an agreement to acquire Bitcoin mining facilities from Generate Capital. The deal is valued at $178.6 million and will significantly boost the company’s Bitcoin production. It acquired the facilities in anticipation of the Bitcoin halving event scheduled for April 2024.
Marathon Digital will acquire mining facilities in Nebraska and Texas, which will add an extra 390 megawatts to its existing capacity. With the new facilities, its mining capacity stands at 910 megawatts.
With the new acquisition, Marathon Digital will now own 4 of its capacity, while the rest is managed via third-party hosting. Within the next two years, the company plans to double its hash rate to 50 EH/s.
The Bitcoin Halving
Marathon Digital’s latest acquisition aligns with its strategy of growing its Bitcoin and cash reserves while lowering its debts in preparation for the Bitcoin halving. With the new acquisition, the company estimates its cost of mining BTC will drop by 30%, a marked improvement in efficiency.
Recent Company Performance
According to its latest Q323 earnings report, Marathon Digital saw a 671.07% rise in revenue compared to the same time last year. For the quarter, the company reported a revenue of $97.85 million. It also reported an EPS of -$0.07, a surprise of 64.26%.
Stock Performance
MARA stock has had a great performance this year, rising 570.44% YTD. During early morning trading on December 20, 2023, the stock was up 3.76%. The growth can be attributed to rising revenues on the back of a soaring crypto market.
MARA Stock Forecast
Based on its recent stellar performance, analysts give MARA a buy rating. They predict a high of $24 and a low of $4. The stock’s average price target is $12.41, which a 45.59% decline based on the last price of $22.98.
Should You Buy Marathon Digital Stock?
Marathon’s recent consolidation move will see it rewarded during the Bitcoin halving event. It has positioned itself to get the most gains from the event and also set the stage for long-term growth.
While the price of Bitcoin can vary greatly based on market sentiment, it has been doing quite well recently. YTD, Bitcoin is up 164.79%, with signs of the bull continuing up until mid-2024. Consequently, the analysts’ buy rating for MARA stock is accurate.
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