H.C. Wainwright Starts Marathon Patent Group (MARA) at Buy
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H.C. Wainwright analyst Kevin Dede initiates coverage on Marathon Patent Group (NASDAQ: MARA) with a Buy rating and a price target of $7.50.
The analyst commented, "We are initiating coverage of Marathon Patent with a Buy rating and setting a $7.50 target price based on the company's rapid ascendance to cash generation with the launch of next-generation mining equipment next year. As the controversy surrounding bitcoin's repute as both a medium of investment and a transactional currency gradually fades, perhaps inversely proportional to its escalation in value, we see Marathon gaining notoriety as an independently run, uniquely powered, well capitalized North American miner leading the next wave of hash rate enhancing bitcoin miner deployment. Specifically, Marathon has secured the purchase and future location—complete with low-cost power and all-in management fee of $0.034 kWh—for more than 20,000 Bitmain S19 Pro Antminers, arguably the most power-efficient mining machines now available. The deployment is slated to begin in earnest early next year, and plans call for all 2.6 EH/s to be in place, operating, and networked by July 2021, which could put Marathon in position to deliver as much as 1.5% of the entire bitcoin network hash. Importantly, bitcoin, we think, should not be viewed as an inconsequential, fly-by-night blockchain-based software platform that disappears with the evolution of some other new cryptocurrency, and in fact we point to bitcoin's top-of-the-chart lead in overall crypto market capitalization last count at approximately $350B, or about 6x second-place Ethereum, compounded by crypto's now recognized status as an "alternative" investment by $3.3 trillion AUM investment manager, Fidelity. As such, we see Marathon rising through the crypto fog of misunderstanding while presenting a highly investable asset for a number of reasons, some of which include: (1) large scale, wholly controlled mining facility with locked-in low cost power and management fees; (2) expert stewardship by a highly experienced CEO adept at maneuvering within financial markets and extracting higher orders of value in commodity, e.g., bitcoin, trades; and (3) structured partnerships that could amplify Marathon's power usage to beyond anything seen in North American crypto mining in delivering power at a rate approaching more than 5% of the entire 9.6GW global bitcoin mining network power consumption."
Shares of Marathon Patent Group closed at $3.64 yesterday.
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