Jefferies Lowers Price Targets on Bitcoin Mining Stocks

Jefferies analysts have revised downward the price targets for both Marathon Digital and Argo Blockchain Plc due to the ongoing effects of the Bitcoin halving.

The investment firm noted a “modest recovery” in June following a decline in May, yet it also pointed out persistent challenges in the market.

Despite a slight uptick in Bitcoin prices and a drop in network hash rate during June, Jefferies has reduced Marathon Digital’s price target from $24 to $22 per share, while lowering Argo Blockchain’s target from $1.50 to $1.20 per share.

The report includes insights into recent mergers and acquisitions, such as Riot Blockchain’s unsuccessful attempt to acquire Bitfarms and Cleanspark’s successful acquisition of GRIID Infrastructure to enhance its hosting capacity.

Jefferies observes a strategic shift among some miners toward high-performance computing and AI hosting, prompted by the declining profitability of Bitcoin mining after the halving. Several companies, including APLD, IREN, HIVE, HUT, and the newly emerged CORZ, are exploring this diversification.

The analysis concludes by highlighting Marathon Digital’s initiatives to seek alternative solutions, including a partnership with Kenya’s Ministry of Energy to investigate the potential use of stranded renewable energy for Bitcoin mining.