What's Going On With Bitcoin-Miner Marathon Digital's Stock?

Marathon Digital Holdings, Inc. MARA shares are moving Monday. The company announced a decrease in Bitcoin BTC/USD production for May and Kerrisdale Capital issued a short report on Riot Platforms, Inc. RIOT last week.  

What To Know:

Marathon Digital announced on Wednesday that it produced 616 bitcoins in May, down from 850 in April and a 50% decrease from 1,245 bitcoins in May 2023. The company also said it had increased its holdings to 17,857 bitcoins. 

Marathon said it energized approximately 5,000 additional miners (c. 0.7 EH/s). Approximately 9,000 miners were reinstalled at the Ellendale facility, awaiting a return to full energization. As a result, Marathon’s operating fleet increased to approximately 246,000 bitcoin miners theoretically capable of producing 30.6 EH/s, with 237,000 miners (c. 29.3 EH/s) fully operational. In May, Marathon achieved a peak overall hash rate of 28.1 EH/s. 

“In May, we mitigated the impact of the April Halving event by increasing the number of blocks won, resulting in the production of 616 bitcoin, a decline of only 27%,” said Marathon CEO Fred Thiel. 

Kerrisdale Capital issued a short-seller report on peer bitcoin-miner Riot Platforms last Thursday which alleged that the crypto-mining industry is one of the worst business models for a public company due to unpredictable revenue, high capital requirements and fierce competition. The short report may have contributed to Marathon shares dipping to close down more than 7% Friday.

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Is MARA A Good Stock To Buy?

An investor can make a few decisions when deciding whether a stock is a good buy. In addition to valuation metrics and price action which you can find on Benzinga's quote pages – like Marathon Digital Holdings‘ page for example – there are factors like whether or not a company pays a dividend or buys a large portion of its stock each quarter.

These are known as capital allocation programs. Marathon Digital Holdings does not pay a dividend, but obviously has a few ways it can return value to shareholders. Feel free to search Benzinga's dividend calendar for the next company that is due to pay a dividend and determine what kind of yield you can earn for holding a share of the company.

For example, if you're looking to earn an annualized return of 13.14%, you'll need to buy a share of Annaly Capital Management by June 28, 2024. Once done, you can expect to receive a nominal payout of $0.65 on July 31, 2024.

Buyback programs are obviously different and highly variable. A company can approve a buyback program and purchase shares as it sees fit over the course of time in which the buyback was authorized. Looking through the latest news on Marathon Digital Holdings will often yield whether or not the company has approved a buyback program recently. Buyback programs usually serve as a support for share prices, serving as a backstop for demand.

MARA Price Action: According to Benzinga Pro, Marathon Digital shares are up 0.52% at $19.35 at the time of publication Monday.

Image: Pete Linforth from Pixabay