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Investing.com --JP Morgan shifted its stance on U.S.-listed bitcoin miners, upgrading Marathon Digital (NASDAQ:MARA) to Overweight while cutting Iren and Riot Platforms (NASDAQ:RIOT) to Neutral, citing stretched valuations after strong year-to-date rallies.
The brokerage raised price targets across the group due to higher bitcoin prices and improved profitability, but said June curtailments weighed modestly on Q2 mining output.
Marathon’s shares do not yet reflect its increased 2025 hashrate target of 75 EH/s, JPMorgan said.
Whereas shares of Iren and Riot, up 80% and 42% year to date, already reflect a significant portion of expected gains from high-performance computing (HPC) expansion.
“We favor the pure-play operators within our coverage universe, as they offer the best relative value and are best positioned to benefit from a rising bitcoin price,” analysts at JP Morgan said.
HPC names feel a little stretched, particularly in light of long and unpredictable sales cycles.
JPM estimates Iren shares price in about half of the potential value from its Horizon 1 project, while Riot may need a firm HPC deal or further bitcoin price gains to move higher.
“Our price targets generally increased due to higher bitcoin prices and improving mining profitability, though our 2Q total revenue and coins mined estimates declined modestly due to greater-than-expected curtailment in June, which weighed on mining production,” said JPM.
Iren target is now $16 from earlier $12. Riot was slightly raised by $1 at $15. Marathon Digital price target was bumped to $22 from $19.