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Marathon Digital Holdings, Inc. (MARA) Stock Spirals Down Despite Promising Q1 2021 Financial Reports

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Marathon Digital Holdings, Inc. (MARA) stock prices were down 11.20% as of the market closing on May 10th, 2021, bringing the price per share down to USD$27.82. Subsequent pre-market fluctuations saw the price fall another 8.73%, down to USD$25.39.

Stellar Financial Reports

MARA reported a monumental year-over-year increase in total revenues, with the first quarter of the fiscal year having reported USD$9.2 million against the USD$592,000 reported in Q1 2020. Largely attributable to a USD$132 million unrealized gain following the change in value of the company’s USD$150 million Bitcoin investment in January 2021, net income was reported to be USD$83.4 million. This represents a net income of USD$0.87 per diluted share, as well as a massive increase over the USD$1.1 million net loss reported in the year prior, which represented a net loss of USD$0.12 per diluted share.

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Solid Liquidity Position

Adjusted EBITDA also very significantly improved, with a reported income of USD$137.4 million up from a loss of USD$479,000 reported in the first quarter of the fiscal year 2020. The company reported having USD$204.4 million in cash, while total liquidity, which also included bitcoin holdings, came out to USD$503.2 as of May 6th, 2021.

Bitcoin Mining Venture

MARA produced 192 newly minted bitcoins in Q1 2021, with 386 newly minted bitcoins having been produced in 2021 as of May 6th, 2021. The company also increases its active miners to 6,800, putting their total active mining fleet at 13,644 miners as of May 6th 2021. As of May 6th, 2021, MARA reported having 5,324 bitcoins, priced at USD$56,135 each. Resultingly, the value of the company’s bitcoins held as digital currency was approximately USD$298.8 million.

Additional Developments

The recent rebranding to Marathon Digital Holdings was meant to aptly reflect the company’s leading position as a digital asset technology company. With the recent appointment of a new CEO, the company is poised to be led into an unprecedented era of growth. Consolidating confidence in this hope is the fact that MARA has become the first North American enterprise Bitcoin miner that has produced the digital currency in accordance with anti-money laundering (AML) and the U.S Department of the Treasury’s Office of Foreign Asset Control’s (OFAC’s) standards. They managed this by directing all of their hash rate to the Marathon OFAC Pool.

Future Outlook for MARA

With stellar financial reports to back them, MARA is on a trajectory of significant gains. Current and potential investors hope the new leadership will be able to leverage the company’s resources and solid liquidity position to usher in significant and sustained increases in shareholder value.

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