Marathon Digital Holdings (NASDAQ: MARA) stock garnered attention after Jefferies slashed its price target.
Marathon Digital (MARA) recently found itself under the spotlight following a significant adjustment in its price target by Jefferies, a prominent global investment banking firm.
Jefferies has slashed its price target for MARA stock to $24 from the previous $30 while maintaining its Hold rating. This decision comes in light of operational disruptions at Applied Digital sites, which have shaken the firm’s confidence in Marathon’s future performance.
The analyst at Jefferies highlighted that the adjustment reflects concerns stemming from the recent downtime experienced by Marathon at the Applied Digital locations. This downtime has influenced the firm’s outlook on Marathon’s operational reliability forward. Despite the setback, the profitability of Bitcoin (BTC) mining saw a notable uptick in February, with BTC prices rising by 15%, outpacing the network hash rate’s more modest 9% growth.
The surge in the network hash rate over the past year, nearly doubling, signifies heightened competition and increased mining activity. However, publicly traded mining companies like Marathon haven’t experienced a proportional increase in market share. The analyst highlighted the upcoming halving event, which reduces the reward for mining new blocks, potentially favoring mining operations equipped with modern ASIC hardware and access to low-cost power.
Marathon Digital has been strategically acquiring its hosting partners, viewed by the Jefferies analyst as a defensive move in preparation for the halving event. The firm supports this strategy, suggesting it may help Marathon mitigate halving-related risks and fortify its future growth prospects.
Marathon Digital (NASDAQ: MARA) Stock Movement
MARA stock rose 0.38% to close at $20.95 on Monday. The traders had exchanged hands with 64,877,052 (64.87 million) shares compared to the average daily trading volume of 85.76 million.
Edward Cooke is a financial analyst, freelance writer, and editor. He has six years of experience in financial journalism. He has an in-depth understanding of equities markets, tracking major indices and providing real-time analysis on stock price movements, corporate earnings, and market sentiment.
