Title: Bitcoin Mining Stocks Overvalued Ahead of Halving, Analysts Warn
Bitcoin mining stocks have taken a hit since the beginning of the year, with many still considered overvalued, according to industry tracker Power Mining Analysis. The firm’s figures show that the price-to-book ratio of most publicly traded miners exceeds 1.0, indicating that their market capitalization surpasses their net asset value.
Examples of this include Marathon Digital (MARA) with a ratio of 2.51 and Cipher Mining (CIFR) with a ratio of 3.15. CleanSpark (CLSK) has the highest price-to-book ratio at 3.59, despite its 33% increase in performance this year. Even miners like IREN and RIOT, which have seen significant declines, still have neutral ratios of 1.00 and 1.15, respectively.
Power Mining’s analysis also includes the “cost value of hash rate,” which measures how much hash rate a company produces relative to its enterprise value. BitDigital (BTBT) emerges as the most undervalued miner with a ratio of $27.05 per current terahash per second (TH/s).
Despite the cold metrics, financial broker Bernstein believes that Bitcoin miners are a smart investment right now. They argue that stock prices are dropping due to fears surrounding the upcoming Bitcoin halving, but they anticipate a rebound post-halving.
Analysts Gautam Chhugani and Mahika Sapra from Bernstein recommend CLSK and RIOT as “outperform” rated stocks, predicting that the market will reward these firms for their leadership in self-mining hash rate.
It’s important to note that metrics and ratios should not be viewed in isolation, as additional revenue streams and future earning potential can impact a company’s valuation. With the Bitcoin halving event on the horizon, the market for mining stocks remains uncertain, but analysts remain optimistic about the future of the industry.
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Source: https://decrypt.co/226848/these-bitcoin-mining-stocks-are-overvalued-ahead-of-halving-analysts
