Crypto Miner Marathon Digital Rallied Over 600% In 2023, Analysts Raise Estimates

Marathon Digital MARA reported a 622.8% surge for 2023, a year that saw it acquire multiple mining sites for $179 million.

The company will likely add 390 megawatts of capacity to its portfolio. The current capacity stands at 584 megawatts.

The transaction is expected to close in the first quarter (Q1) of 2024 and will be funded with cash from the balance sheet.

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The MARA stock witnessed most of the surge in the past month’s trading (+142%) due to optimism surrounding Bitcoin BTC/USD and the broader crypto industry.

Crypto miners, in general, have been on the roll as they report three-digit gains on a year-to-date basis:

• Riot Platforms RIOT reported 397%,
• HIVE Digital Technologies HIVE, 212%
• Bitfarms BITF, 565% and
• and Bit Digital BTBT, 426%.

Bitcoin on a year-to-date basis stood with 162.5% gains for the same timeframe.

Needham's analysts are positive on Marathon’s mining sites acquisition as it lowers power costs, increases hash rate capacity, and adds operational leverage.

Maintaining its Hold rating, Needham has raised its 2024 revenue and EBITDA estimates.

MARA’s power costs are some of the highest among public miners. Also, Bitcoin transaction fees peaked at a record two-year high, thereby adding around 30% higher mining rewards for miners.

As of Dec. 20, Bitcoin Average Transaction Fee BATF stood at 31.65 compared to 10.35 as of Nov. 20. Bitcoin Average Transaction Fee measures the average fee in USD when a Bitcoin transaction is processed by a miner and confirmed.

The Masked Investor took to his X platform on Dec. 20 and said that H.C. Wainwright & Co. raised the price target on MARA to $24 from $20 and maintained its Buy rating.

Also, MARA was in the spotlight by Stock Market Genius on Dec. 21. The social media post said, “High volume, high interest.”

In its most recent quarter, Marathon saw a swing in its net income to $64.1 million in Q3 compared to a net loss of $72.5 million during the same quarter a year ago.

Driven by a 467% surge in bitcoin production and a 32% increase in average Bitcoin prices, MARA revenues multiplied more than seven times to $97.8 million during Q3.

Looking ahead, the company estimates to grow the hash rate by around 30% in 2024.

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