On Friday, H.C. Wainwright adjusted its price target for Marathon Digital Holdings (NASDAQ:MARA), a cryptocurrency mining company, from $35.00 to $27.00 while maintaining a Buy rating. The revision follows Marathon Digital's recent earnings report, which showed an increase in revenue for the March quarter.
Marathon Digital announced a revenue of $165.2 million for the March quarter, a 5% rise from the $156.8 million recorded in December. The increase came despite challenges, including transformer failures at the Applied Digital-run site in Ellendale, North Dakota. The site, as per the latest updates, is now operating at around 66% capacity.
The operational setbacks experienced in April resulted in an average operating hash rate for Marathon of 21Eh/s. However, with the site's partial recovery, the company's hash rate has improved to approximately 27Eh/s. Analysts expect this to reflect positively in the company's performance numbers for May, anticipating less impact from negative weather and other obstructions.
The adjustment in Marathon Digital's price target to $27 is attributed to shifts in the valuation of bitcoin mining companies following the launch of a bitcoin exchange-traded fund (ETF).
Despite the lowered price target, H.C. Wainwright reaffirms its confidence in Marathon's growth potential by reiterating the Buy rating. The firm anticipates that the company's hash rate growth will continue to progress, which is a key factor in their ongoing positive outlook.
InvestingPro Insights
Marathon Digital Holdings has been a topic of interest for analysts and investors alike, with recent data from InvestingPro providing additional insights into the company's financial health and stock performance. The company's market capitalization stands at a robust $5.36 billion, reflecting its significant presence in the cryptocurrency mining industry. Moreover, Marathon Digital's P/E ratio, at 13.89, suggests that the stock is trading at a price that is relatively low in comparison to its near-term earnings growth, indicating potential value for investors looking for growth opportunities.
InvestingPro Tips highlight that analysts are optimistic about Marathon Digital's sales growth in the current year, reinforcing the positive sentiment expressed by H.C. Wainwright. Additionally, the company's stock has experienced a significant return over the last week, with a 12.16% price total return, which may attract investors seeking short-term gains in a volatile market. For those interested in a deeper analysis, InvestingPro offers more tips, with a total of 15 additional insights available for Marathon Digital, which can be accessed through the InvestingPro platform.
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