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3 Crypto Stocks to Buy as Bitcoin Rises Again

Bitcoin (BTC-USD) has always surprised investors. The cryptocurrency closed 2022 at around $16,500. In the first three months of the current year, its price jumped 64%. As the extended crypto winter comes to an end, there are some attractive crypto stocks to buy that have multibagger return potential.

There are several reasons for bitcoin’s strong rally. First, the cryptocurrency has been significantly oversold. Second, the relative weakness of the US dollar has been positive for bitcoin. It should also be noted that another bitcoin halving is expected to take place in April 2024. In the past, halving events have been followed by a large rally. Therefore, there are reasons to believe that bitcoin will continue to rise.

Crypto stocks have been battered in 2022. As sentiment in the sector has turned bullish in the new year, several crypto stocks have already jumped over 100%. However, I expect multibagger returns for quality crypto stocks even from these levels, provided bitcoin stays in an uptrend, which seems likely.

Below are three crypto stocks to buy at current levels.

PIECE OF MONEYCoinbase$62.54
RIOTRiot platforms$8.04
MARADigital Marathon$7.11

Coinbase (COIN)

Source: Sergey Yelagin / Shutterstock.com

Coinbase (NASDAQ:PIECE OF MONEY) the stock has jumped 76% since the start of the year. A week ago, however, the stock was up over 100%. The shares were minted after the Securities and Exchange Commission (SECOND) sent Coinbase a warning that it had identified potential securities violations.

However, if bitcoin’s bullish momentum continues, so does COIN’s rally. ARK Invest Cathie Wood seems to think it will. She bought millions of dollars worth of COIN shares on the downside.

Coinbase posted a sharp decline in revenue for 2022, along with an adjusted EBITDA loss of $371 million. Total trading volume was down 50% for the year, while trading revenue fell 66%. The recovery is expected to be gradual in terms of business activity gaining momentum. However, I like that Coinbase ended 2022 with cash and cash equivalents of $5.5 billion. This gives the company great flexibility for product development and international expansion.

Another point of note is that Coinbase saw 53% growth in subscription and service revenue in 2022. As assets held on the company’s platform increase in price, blockchain rewards and childcare costs are likely to inflate. Finally, during the previous bitcoin rally, Coinbase saw strong growth in institutional investor activity. This could again prove to be a catalyst for revenue growth and improved margins.

Riot Control Platforms (RIOT)

image of bitcoin to represent cryptocurrency stocks

Source: Shutterstock

With bitcoin trending upward, there are strong arguments for a revival in the fortunes of bitcoin miners like Riot platforms (NASDAQ:RIOT). The stock looks attractive at current levels of around $8 per share despite rallying 147% year-to-date. Indeed, the rally should sustain if bitcoin remains in an uptrend.

A big reason to love Riot is the company’s core strength. At the end of 2022, Riot declared $230 million in cash and cash equivalents. With no long-term debt and 7,058 bitcoins on its balance sheet, financial flexibility is robust.

Another reason to be bullish on Riot is the fact that the company is a low-cost bitcoin producer. In 2022, Riot recorded a bitcoin mining gross margin of 60.3%. With the upward trend in cryptocurrency, significant margin expansion is in the cards.

It should also be noted that the company has been steadily increasing its mining capacity. In March, the company reported a hash rate of 9.8 exahashes per second (EH/s). Additionally, Riot plans to increase mining capacity to 12.5 PE/s over the next few months.

Digital Marathon (MARA)

Macro view of miner working for bitcoin mining pool.  Devices and technology for cryptocurrency mining.  Mining cryptocurrency concept.  MARA stock.  Crypto mining.

Source: Yev_1234 / Shutterstock

digital marathon (NASDAQ:MARA) is another bitcoin miner that looks set for multibagger returns. Since the beginning of the year, MARA shares are 108% higher. It should be noted that when bitcoin hit all-time highs, MARA stock was trading around $80. The stock is currently trading below $8.

At the end of 2021, Marathon reported an installed hash rate of 3.6 PE/s. Last year, the company increased its mining capacity to 9.1 PE/s. Marathon continues to forecast that it will reach 23 PE/s by the middle of the year. Even though the expansion is complete towards the end of 2023, the business is positioned for robust growth.

On the other hand, Marathon recorded significant operating losses in 2022. However, this is expected to reverse in the current year as bitcoin trends are on the rise. Additionally, with significant capacity expansion, digital assets on the balance sheet will swell. This will provide Marathon with great financial flexibility.

As of the date of publication, Faisal Humayun does not hold (either directly or indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com publishing guidelines.

Faisal Humayun is a senior research analyst with 12 years of experience in credit research, equity research and financial modeling. Faisal is the author of over 1,500 stock-specific articles focused on the technology, energy and materials sectors.


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