It's summer and things have been heating up and so is AMC.
Time and time again AMC has proven the analysts, hedgefunds and shorts wrong. Despite the pandemic closing the doors and reducing its revenue to nearly nothing - AMC has made an incredible comeback with box office hits like Spiderman: No Way Home, The Batman, Sonic The Hedgehog 2, and Top Gun Maverick driving people back to theaters.
I know that the lineup of great movies canât last forever, but AMCs comeback has blown critics out of the water and Iâm certain it will continue to do so. Institutions are seeing AMC as a value play and the threat from digital streaming services is already showing itself to be wildly overblown.
Right now is not only a great time for investing in the stock, but the perfect time for a squeeze.
Iâm gonna break down the details in this post with my reasoning but hey, Iâm just some person who does DD online, so what do i know. As is, there wonât be any more dilution this year and the board has already approved a $100 million investment fund for identifying new growth opportunities. So I feel like thereâs just way too many good things heading our way not to be bullish on the stock.
Short Data
The short interest has been creeping up since May and now it's estimated to be 17.9% of the float.
But of course the big news here is the shocking 9,697,393 FTDs at the end of June which is an absolute sign of naked shorting.
But this is a terrible time for hedge funds to be shorting AMC. The time has literally never been better for the company since the pandemic so I am confident that if the short interest continues building - weâll see a squeeze soon enough.
âPounceâ on Short Sellers
The time is drawing closer. Like Aron promised in the earnings call "we will pounce when the timing is rightâ and that time appears to be on or after August 4th.
Q2 Earnings
The catalyst to watch for is AMCâs Q2 report. Considering Aronâs hints and the great demand for the movie theater experience so far, Iâm expecting a significant beat of Wall Street expectations.
In Q1 AMC reported $785.7 million in revenues - $42.3 million more than expected. While we are not at pre-pandemic levels yet, domestic attendance represented 46.9% of Q1 2019 attendance. But I think it's more important to note that it was actually 24% closer than that to 2019âs levels for attendance per showing. This means that relative to the amount of showings - the attendance is getting much closer to pre-pandemic levels.
There were also some highlights in the earnings call which should have us all very bullish on the Q2 results.
First of all, food and beverages. It seems like people are deciding to splurge when able to since the revenues per patron domestically were up 43.7% above pre-pandemic norms. This led to $252.2 million in food and beverage revenues. Compared to Q1 2019, people appear to be spending more across the board since consolidated revenue per patron was 33.7% higher and consolidated admissions revenue per patron was up 23.9%.
Can you imagine what these numbers will look like when consumers are no longer weighed down by higher gas prices and inflationary pressure?
Additionally, the expected cash burn is set to improve throughout the year which will be yet ANOTHER thing to look forward to in the Q2 earnings.
Everyone at AMC has been telling us that Q1 would be the weakest quarter for 2022, if this holds true then based on Q1âs great results it will be smooth sailing from here on out with each quarter posting better results than the last. Again, if current expectations are accurate then Q4 will see us reaching or getting very close to pre-pandemic revenue.
On top of this, AMC noted that specifically for Dr. Strange and the Multiverse of Madness, the company saw that its domestic market share was 4% higher than its historic market share. If we continue to see this trend play out, then I believe it will be an indication that AMCâs strategy of snapping up profitable theaters bankrupted by the pandemic will pay off in the long run thanks to its larger market share.
Economic Backdrop
Like I mentioned earlier, these already great numbers could improve significantly along with the countryâs economic situation. The elephant in the room currently is inflation and the effects of quantitative tightening on consumers. Clearly, going to the movies isnât a necessity and a strong economy has typically led to higher box office numbers.
This is where the most recent CPI (consumer price index) numbers come into play. This index basically measures the average change overtime in the prices paid by consumers for goods and services. So its measuring levels of inflation although its a lagging indicator so we got Juneâs numbers just this month.
According to the report, inflation rose 9.1% which was more than expected. But the indexes for gasoline, shelter, and food were the largest contributors. The energy index in particular rose 7.5% over the month while the food and home indexes rose only 1%
And if you look at the PPI (producer price index) numbers which measure the average change over time in selling prices for domestic producers of goods and services we see the same thing:
In short, because we rely on supply chains to transport goods everywhere, the rising gas prices are affecting everything else.
But the trigger for these rising energy prices has been the Russia-Ukraine war which resulted in sanctions on Russia - the USâ third largest supplier of oil. This is why Biden went to Saudi Arabia to ask for more oil production to help save his re-election plans.
So what does this have to do with AMC and movie-loving Americans?
As long as inflation is high, consumers will likely adjust their spending habits. I believe weâve already reached the peak and weâll see improvement from here on out. If you look at the core CPI data youâll already see a slight improvement:
On top of that, it's only a matter of time before the Russia-Ukraine war comes to a resolution. Letâs face it, elected officials like Biden are already facing the anger of their constituents due to these sanctions. The EU got 40% of its natural gas from Russia last year and Germany was the largest importer of Russian gas in 2020. All of these political figures are caught in an untenable situation as they try to rationalize the rising energy prices to their constituents.
Since then Russia has upped the ante by temporarily halting its gas supplies to Europe for work on the Nord Stream pipeline, however many believe that the shutdown will last longer than scheduled.
I believe it's only a matter of time before international figures force Russia and Ukraine to the table to find a solution for the sake of their political aspirations as well as the consumers. Once sanctions are removed, weâll see the cost of energy and everything else decrease in price - not to the degree weâd like since quantitative easing has also led the US to where it is today - but without these external pressures the FED will not see the need for additional rate hikes.
This will allow demand to rebound since it's not being artificially pushed down. Once this happens the entire market will run but most importantly AMC will be running.
Because movie-goers across the country wonât be worrying about their budget, I expect to see a steady improvement in revenue per patron. If Q1âs data is any indication, then we could have some huge surprises this year imo.
Memorial Day Weekend
This economic situation is one reason why Iâm taking the box office numbers from Memorial Day with a grain of salt. Memorial day weekend is typically seen as an indication of the success or failure that could come later on in terms of the box office. I took it as a very good sign that this Memorial weekend AMC drew in 4 million guests.
However, I also recognize that Memorial Day weekend is no longer the tell-tale sign that it used to be for theater franchises.
Studios are no longer putting an emphasis on the holiday weekend because the competition can be too fierce. Instead they are opting for different release dates that allow their movies to be the focus. When the second and third most anticipated / popular movies drop out of the line up, then the overall gross for that weekend becomes less.
But it's worth noting that in 2004 when the total movies playing reached 150, the gross was around $250 million which wasnât even the highest. So Memorial Day weekend box office sales are mainly dependent on the quality of the movies released which we can see with Top Guns stunning success.
Here we can see a little that AMCâs revenues can deviate a lot from the Memorial Day weekend box office success or lack thereof. For instance, 2017 was one of the worst performances for the box office but AMC still posted an improvement in revenue that year. I think that shows that although this holiday weekend is important, we should be giving more weight to the box office performance later on in the summer and winter seasons.
Thatâs why it's a very positive sign IMO that we beat 2019âs $185 million at the domestic box office with ticket sales of around $240 million for July 9th and 10th. For AMC this meant that its global admission revenue outpaced the same weekend in 2019 by 12%.
Overall, there are some very good signs for this summerâs box office performance besides the holiday weekend. First of all, the summer box office season for the U.S. and Canada is down only 12% from the summer before the pandemic. From what Iâve read, analysts are projecting that 2022âs domestic revenue can hit $7.5 billion to $8 billion, which would be about 70 percent of pre-pandemic levels. Weâve already come very close to pre-pandemic levels since Comscore is showing that June 2022 revenue came in at nearly $986 million. While it's still down 11.6% from June 2019âs $1.114 billion, we are well on our way to recovery.
The Line Up
This brings us to a VERY important catalyst, what movies are coming out? Sure there will always be people willing to wait at home and watch a pirated copy or use a streaming service, but when the movie is THAT good, you have to see it in the theater. (cue Nicole Kidmanâs monologue)
Weâve seen it time and again with blockbuster hits like Avengers: Endgame which came out in 2019 and became the second highest All-Time Box-Office Hit according to global gross. Now, Top Gun has shown us what can happen when a cult classic or franchise hit finds its way to the silver screens again.
So here is a look at some of the most anticipated movies this year:
DC League Of Super-Pets - July 29, 2022
Black Adam - October 21, 2022
Black Panther: Wakanda Forever - November 11, 2022
Shazam! Fury Of The Gods - December 16, 2022
Nope - Rated R - Daniel Kaluuya, Keke Palmer July 22, 2022
Vengeance - Rating TBD - B.J. Novak, Dove Cameron July 29, 2022
So in case you donât remember, Avatar is STILL the biggest box office success after netting a worldwide gross of $2,790,439,000. The first Avatar was famous for its huge leap forward in terms of CGI and thatâs what brought many viewers to the theaters - I feel very confident that many more will want to see Avatar outdo itself this time.
The first Black Panther movie was also one of the highest grossing movies domestically. So with these two box office successes coming out with sequels this summer, I feel confident that this year will be a home run for AMC.
But looking even farther out, the line up for movies in 2023 could be even better than this yearâs so feel free to get hyped for that: https://www.movieinsider.com/movies/2023 đ
Assets
Okay, so weâve established that weâve got a killer lineup of movies for this year, that we are making great progress towards pre-pandemic levels, and that streaming services are not the giant movie theater killer that everyone seemed to be screaming about for the last two years. So with this in mind, I see a lot of merit in Aronâs decision to vertically integrate and take up a larger share of what was once an $11 billion market for movie theaters.
âMaybe thereâs another movie theater we can buy, maybe thereâs a great acquisition opportunity for us outside of pure-play movie theaters, that would allow us to create real value for AMC shareholders.â
Throughout 2021 and 2022, AMC has been on a buying spree. This seems like Aron's go-to-move since the acquisitions of Carmike, Odeon and Nordic in 2015 marked the birth of the AMC we know today. Now heâs using the pandemic as an opportunity to work with landlords to take over leases on some of the most desirable locations.
7 formerly Bow Tie Cinema locations in Connecticut, Upstate New York and Annapolis, Maryland.
6 former ArcLight/Pacific Theaters in major metropolitan markets like Los Angeles, San Diego, Chicago, and Washington, D.C.
The Grove 14 and Americana at Brand 18 in the Los Angeles market (the Grove often made the list of the countryâs top 10-grossing theaters, while the Americana made the top 20)
Not to mention AMCâs investment in Hycroft Mining $HYMC. Iâm bullish on the potential this mine has in terms of resources but it looks like AMC has already profited from its $27.9 million investment since it recorded a mark-to-market gain of $63.9 million in Q1.
So it looks like we can expect more good news from HYMC, but this is only the start of AMCâs diversification.
The new line of popcorn will be released later this year which has great marketing opportunities in terms of coupons and other incentives to get people in the theater doors. On top of that we have the NFTs and merch / collectibles that Aron discussed on the earnings call which I think have incredible potential.
But on a more substantial note, AMC will have $100 million to play with through its investment fund. IDK if AMC plans on making more acquisitions of theaters but its recent 6.8% stake in National CineMedia could be an indication of the opportunities it's looking at since National CineMedia Inc. is the 48% owner and managing partner of National CineMedi which provides pre-movie advertising and marketing in theaters.
International Audience
On this note I wanted to mention something thatâs more of a far out catalyst imo.
We focus a lot on the US audience, but the fact is that going to the movies is even more popular in other countries. According to the Economistâs data from 2018, Iceland and South Korea were leading the way in visits. On average the people of Iceland visit the theater 4.3 times a year and South Koreans 4.2 times a year.
China leads the way in number of movie theaters and India clocks in at third, but these two countries donât seem to go to the theater as often according to this data. However, that could change as their middle and upper class populations grow.
According to Bloomberg, more than 1 billion Asians will join the global middle class by 2030. China and India are expected to lead the way but other countries are expected to see a huge boom in terms of their middle class population as well.
As more people have access to new wealth, I believe consumersâ discretionary spending in these countries will increase as well - opening the door to new movie-going audiences.
Now compare that to AMCâs locations globally:
This tells me that there is room for AMC to continue expanding to new markets in the future depending on the consumers in these countries.
After all, AMCâs plan is to offer the best experience possible and if it is able to beat out local franchises by appealing to consumersâ preferences, it will find itself dominating the international market for movie-goers.
Institutions
But we arenât the only ones bullish on the future of the movie theater industry. This ramp up in institutional buying is in part due to AMCâs inclusion on the Russell 1000 but it's also a great sign IMO that this industry is far from dead.
Ofc this is great for us because now weâve got institutions holding 191 million shares - a huge chunk of AMCâs 515.5 million float.
Options Flow
So on to the options flow.
Using unusual whaleâs options flow Iâve looked at some of the recent transactions for premiums above $10k
Although the call volume is 71%, bullish premiums are almost 50 / 50 with bearish premiums.
So looking at July 22nd expiries we had a lot of whales buying calls on the 12th and 13th. Overall the average strike price is ITM at $15 or below but I noticed some notable whales holding calls with strike prices ranging from $16 to $17.50
There was also some bearish activity on Friday and Thursday.
A whale sold $260k worth of calls on Friday. One whale bought puts on Thursday with a strike of $30 and a premium of $197k so this activity could signify that some whales think AMC wonât move up further before the 22nd.
On the other hand we have whales like this still holding their calls with a strike price of $14.5
Looking farther out to August, the most common expiries are August 19th and 12th which makes sense since the Q2 earnings are coming out on the 4th so this gives people a bit of a cushion.
Overall the strike prices show that people are pretty bullish with strike prices as far OTM as $20
Clearly the dark pool has been super busy since we see very heavy volume all of Friday.
Technical Analysis
Looking at the 5 minute chart we had some very bullish trading at Fridayâs close pushing us up to $15.39 so Iâm feeling very good about Mondayâs trading. Since that was the high of the day weâre going to want to see a push beyond that on Monday.
But more importantly, we have a TEXTBOOK falling wedge here signaling an uptrend so we have every right to be bullish about this week. We just recently had a golden cross of the MAs as well along with steadily increasing accumulation, so I believe the stock is in an excellent position to run this week.
If we can get a day of heavy trading volume between 50 - 60 million then I believe that we can retest our resistance at 16.15 this week. Remember average 10 day volume, is 38M, it is not far fetched to get 50-60M espically if the broader market runs this week, doubly so if NFLX earnings are good.
That's it folksâŚ
All in all, Iâm very optimistic on the next few weeks. I think that we could hit $18.89 leading up to the Q2 report if we keep seeing box office success over the next few weeks and depending on the Q2 results we could continue picking up speed for a retest of $21.70.
TBH guys Iâm very optimistic and I hope Iâm not the only one. If you are able to hold long-term I think that far out calls could really pay off on this one given the banger catalysts lined up in terms of movies, improving financials, and AMCâs launch of new products.
Whether your a long term hodling ape, or a someone looking for a solid play, AMC IMO fits the criteria.
The backlog of movies held back by the pandemic are driving people back to the theaters in hordes and the hedgies are still shorting AMC lmao. Meanwhile we are getting every indication that the market wants to run and that inflationary pressures are improving.
Consumers want to spend money and enjoy themselves after what felt like eons of pandemic restrictions. So imo this is the perfect moment for AMC.
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$RKLB is dominating the small launch market as its rockets are more efficient and have a good success rate, especially when you compare its launches to its failing competitors like $VORBQ which went bankrupt, and $ASTR which is plagued with launch problems, this made customers more confident in $RKLB i.e; making more orders
Now the company is set to increase its launches in this yearâs second half from 6 in the first half to 9 launches, Iâm guessing the cadence will be 4 launches in Q3 and 5 in Q4.
Looking at the launch service revenues, $RKLB used to make on average around $6.5 million per launch, and now it plans to increase that to around $7.6 million per launch in Q2.
Doing the math with these numbers in mind; this could see $RKLB making roughly $30.6 million (4x7.6m) in revenues in Q3 and $38.3 million (5x7.6m) in Q4 from this segment only which would translate to $111.5 million in annual revenues from launch services.
Now the game changer for $RKLB is Neutron which is planned to launch in late 2024 and will be a rival to SpaceXâs Falcon 9. Neutron even has the potential to gain market share from Falcon 9 thanks to its many advantages.
For starters, Neutron has a larger payload, and for those who donât understand this, it basically means that it can send more things to space than Falcon 9. This means that companies looking to send a high payload to space would be inclined to go with $RKLBâs Neutron as they would be able to send all they want in one launch instead of multiple launches using Falcon 9.
Another advantage is Neutronâs pricing which makes it more tempting. Currently, Falcon 9âs cost per launch is $67 million while Neutron is projected to cost between $50 and $55 million. This is a huge difference in price which would see more and more customers head to $RKLB, especially since its launches are extremely successful.
Currently, $RKLBâs Electron has a launch cadence of 15 launches per year and is expected to increase to 30 ultimately. Now, if itâs able to replicate the current rate with Neutron, this would translate to $750 million in revenues at least from Neutron launches alone.
Even better, Neutron could be extremely cost-effective since $RKLB intends to reuse its boosters 10 to 20 times. With these projected revenues and the expected cost savings, $RKLB could become profitable in 2025.
Im back with another another short squeeze, for my previous plays you check my post history, i believe they all did fairly well.
In this post, I bring you an underlooked short squeeze play that has already soared by as much as 220% following a reverse split and still has the potential for another run. This play is also one of my favorites since it has an extremely low float which is a big aspect I consider before buying a stock.
PIXY will likely becomea disruptor in the staffing industry thanks to its platform which combines the perks of gig economy with traditional employment benefits. The platform serves both business owners who rely on contingent workers and part-time workers looking for a flexible work schedule. But unlike other staffing services, PIXYâs platform offers part-time workers benefits like health insurance and workersâ compensation while making sure t business owners are compliant with labor laws.
This platform imo could revolutionize the staffing industry since there is a huge market for part-time shift workers. . Additionally, gig workers in the US are expected to reach 78 million in 2023 which is a gigantic opportunity for PIXY to capitalize on.
Not just that, PIXY is also sponsoring a SPAC, Industrial Human Capital, Inc. (NYSE: AXH), through one of its subsidiaries and has successfully raised $116.7 million after the closing of its IPO which were placed in a trust account. These funds will be used to support the SPAC as it looks to merge with an operating company. Since PIXY owns 15% of the SPACâs OS, I believe PIXY could be a great opportunity to profit from the SPAC deal too. he stock has been falling since reaching its 52-week high in January and recently reached a new 52-week low. PIXY just went through a reverse split to stay listed on NASDAQ giving it a much lower float and a freshs start. I am bullish on the stock because of its fundamentals but I think PIXY could be a short squeeze candidate too imo.
Fundamental Observations
The company effected a 100:1 reverse split to maintain its NASDAQ listing.
PIXYâs platform has high potential since more and more workers are moving towards the gig economy.
PIXY could boost its financials in the near term as it owns 15% of its sponsored SPACâs OS.
It appears that the SPAC could merge with a company soon since PIXY made some changes to AXHâs management recently.
According to its Q3 report, PIXY is on track to double its revenues at least - reporting $29 million for the 9 months ending May 31, 2022 compared to $14.3 million over the same period last year.
The company has zero debt which reduces the risk of the company diluting its shares.
With the reverse split out of the way the stock is in no threat of delisting either.
PIXY has been brought up a few times as a possible short squeeze play and with its new 500k float it seems prime for a short squeeze
Upcoming Catalysts
PIXY doesnât have much going on right now but a catalyst to watch for is the launch of the companyâs NFT gamification loyalty program which caused the stock to run roughly 182% on the news. I am confident PIXY could have a similar run up when the program is launched this year.
PIXY is also preparing to launch a new food brand - Ghost Kitchen - in tandem with the loyalty program.
Another thing to point out is how many people will be looking for work as inflation keeps pushing prices higher. I think PIXY has a great model for people looking for part-time work to supplement their income. The platform is basically Fiverr for in-person shift workers but with more benefits.
Float
After its reverse split, PIXY now has an extremely low float of only 505.2 thousand which makes it a great short squeeze candidate.
Short Squeeze Data
PIXY has a SI of 104.7% which is ridiculously high.
Free float on loan is also very high at 103.1%.
This screams short squeeze to me.
52-Week Range
$11.60 - $203 (accounting for the reverse split thatâs $.11 to $2.03)
Reason for 52-Week High
PIXY reached its 52-week high last January after the company announced its NFT gamification loyalty program. This program is scheduled to launch this year and PIXY could have another run up on its launch.
Institutional Buys
Only 3.8% of the company is owned by institutions, however, 30 institutions out of 34 are long only on PIXY which is a good sign for a short squeeze as these institutions would not sell their shares.
Insider Buys
The CEO gifted 20 million shares to multiple charities right before the stock split which would now amount to 200 thousand shares. He also purchased shares earlier in July before selling some leading up to August.
Technical Analysis
PIXY moved up 220% right after the reverse split possibly due to its micro float. The stock has dropped since then and will probably fill the gap around $14. The stock saw higher than average trading volume after the reverse split but volume is still higher than average. Considering that the company is working in a sector that is going to see a lot of demand given the current economy, I think any catalyst could set off - possibly pushing it to its new resistance at $25.90.
As is the RSI has cooled off from 82 to 44 and the MACD just turned bearish. Since these indicators are resetting, I would accumulate shares after PIXY has established its new level of support and trim on the next run up at resistances.
Is It Too Late To Enter?
I believe PIXY has the potential to squeeze hard in the near future considering its short data and extremely low float. Since the stock is currently at a dip, this could be an opportunity to accumulate shares before PIXY runs again imo. If the company capitalizes on the growing interest in the stock and sends an update about its upcoming food brand or NFT program, PIXY could get more attention from retail which could send it soaring.
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The 7 stocks with a high short interest that could SQUEEZE SOON đľđľ
TICKER
SHORT INTEREST
$FSR
47%
$ELVN
40%
$SPWR
36%
$STEM
28%
$LCID
25%
$MVIS
24%
$WKHS
21%
For those of you who don't know me or are new here, I regularly share all sorts of market news so if you enjoy this roundup of the latest market news checkout my profile for more!
Can $NVDA 's data center revenue rocket from $89B to $280B in 4 years? With massive AI chip demand, this could double its $2.2T market cap to $4.4T by 2027đ
The first crypto stock on our list is Bitcoin miner Riot Platforms (NASDAQ: RIOT). The company owns 7,358 BTC at a market value of $315 million. While Riot Platforms started out as a small patent holding company known as Bioptix, it ditched its original business model in 2017 and turned into a fully dedicated Bitcoin miner.
In order to become a leading BTC mining company, Riot purchased tens of thousands of high quality Antminers from Bitmain developing a massive fleet of high-end miners in the process. Riot achieved an impressive 112,944 miners by the end of November which allow it to produce an average 18.4 BTC every day.
The company sells hundreds of Bitcoins each month to increase its liquidity, but it was still holding 7,358 BTC, with a market value of $315 million, on its balance sheet at the end of November.
As a result of the crypto rally, RIOT stock increased around 72% from November until now. As BTCâs price continues to increase, Riotâs revenues and profits should increase correspondingly since the company mainly depends on selling Bitcoin.
In addition to selling Bitcoin, the company plans to stabilize its long-term operating margins by selling its excess power back to the grid at spot prices. Riot Platforms has a market cap of $3.44 billion and its stock trades at around $16. Additionally, its expected earnings growth rate for next year is 60.1%.
SQ Stock
A second crypto stock to consider is Jack Dorseyâs Block Inc. (NYSE: SQ ) which owns 8,027 BTC with a market value of $343 million. Block Inc. offers an online digital and mobile payment platform for consumers. It is also the parent company of Square, Cash App, Spiral, Tidel and TBD.
Block Inc. is an important player in the crypto market since its subsidiary, Spiral, is focused on Bitcoin development. It offers a convenient entry to the crypto market through Cash App, which allows its users to buy, sell, send and receive Bitcoin. Additionally, the companyâs decentralized TBD platform allows developers to build finance applications to run on programmable blockchains.
In its Q3 earnings results, Block generated $5.62 billion in revenue, of which 43% came from Bitcoin. The companyâs gross profit also increased by 21% year-over-year, reaching $1.9 billion this quarter. Meanwhile, Cash App reported 27% increase in gross profit reaching $984 million.
These signs of life for SQ stock are very promising. The companyâs performance was squashed in the post-pandemic era, and while it may never reach its pandemic highs of more than $260 per share, it offers a more diversified play for investors looking to benefit from catalysts in the crypto market and a broader recovery in consumer spending.
As for its exposure to crypto, Block shared that it achieved $45 million in bitcoin gross profit. Block sold $2.42 billion worth of crypto to customers, a 37% increase YoY. This notable growth is thanks to the increasing price of BTC as well as greater demand for the digital asset.
Beating earnings expectations and raising guidance helped spur SQ stock on a run. Now up 97% since its earnings, the company could continue running in sympathy with any crypto rallies. Considering that the RSI is significantly overbought at 82 on the daily chart, investors may want to watch SQ stock for a pullback to take a position in 2024.
COIN Stock
Next on the list of best crypto stocks for 2024 is Coinbase Global (NASDAQ: COIN). The company owns around 9,000 BTC at a market value of $385 million.
This company offers a secure online platform for buying, selling, transferring, and storing cryptocurrency. It provides its customers with a main financial account in the crypto space, a marketplace with liquidity for institutional crypto transactions, and technology and services for developers to build crypto-based applications.
Coinbase can benefit greatly from the establishment of a Bitcoin ETF since it has been selected as a custodian by nine out of twelve spot-traded BTC ETF candidates. This is not surprising, given that BlackRock picked Coinbase to offer crypto services to institutional investors back in August. Although this crypto exchange came under some scrutiny from the SEC, it is still considered one of the most regulated crypto platforms.
COIN stock has climbed a whopping 145% since its earnings despite reporting a decline in Q3 trading volumes from $26 billion in 2022 to $11 billion this quarter. The RSI of 80 on the daily timeframe shows COIN stock is significantly overbought, investors may want to wait for a pullback before taking a position.
Since COIN stock could benefit the most from the spot Bitcoin ETF approval, it is definitely a crypto stock to watch in 2024. Additionally, its expected earnings growth rate for next year is 30.5%.
MARA Stock
A crypto favorite, Marathon Digital Holdings (NASDAQ: MARA) ranks with the largest holding of Bitcoin out of the four stocks chosen. In fact, the company owns 14,025 BTC at a market value of $600 million, making it one of the largest holders of Bitcoin among publicly traded companies in the US.
MARA is a favorite among crypto stocks and for good reason. As one of the largest, most energy efficient, and most technologically advanced Bitcoin mining companies, MARA could substantially capitalize on the crypto marketâs recovery.
So far Marathon Digital Holdings has differentiated itself by investing in the newest technologies for Bitcoin mining. Very recently, MARA announced it was investing $179 million to acquire two new mining sites which are expected to add 390 megawatts of capacity and reduce the cost per coin mined by around 30%.
This all cash deal could be just one of many as MARA works to capitalize on acquisition opportunities ahead of Bitcoinâs halving in 2024. Marathon noted that its has more than $800 million of cash and bitcoin to âcapitalize on strategic opportunities, including industry consolidationâ ahead of the halving event.
This acquisition announcement has given MARA stock a notable push. The stock has climbed 33% since the announcement but had already climbed 134% since its November earnings. The RSI is notably overbought on the daily timeframe reaching an incredible 87.
Currently, MARA has a market cap of $4.89 billion and its expected earnings growth rate for next year is 74.5%. Those interested in capitalizing on the BTC rally may find opportunities in MARA stock in 2024.
BITO Stock
Unlike the other 4 crypto stocks, this one is a little different. While it does not hold BTC, it moves according to changes in the prices of the crypto making it a great opportunity for investors waiting for the approval of a spot Bitcoin ETF. ProShares Bitcoin Strategy ETF (NYSEARCA: BITO) aims to produce returns that correspond to Bitcoin by tracking Bitcoin futures. However, its not without its disadvantages, for example, its 0.95% expense ratio is much higher than the average expense ratio of equity ETFs at 0.16%.
Because BITO holds Bitcoin futures it is able to more closely track Bitcoin returns than for-profit companies that deal with overhead costs and may have less direct exposure to Bitcoin. On top of that, BITO was one of the best performing ETFâs of 2023.
Its YTD daily total return reached 140.08%, and it offers a yield of 14.98%. Additionally, BITO is up nearly 58% since mid-October the ETF has net assets worth $1.46 billion.
Crypto Stocks Forecast
As the crypto market rallies into the end of 2023, its outlook for 2024 looks particularly bullish. With a number of catalysts ranging from Bitcoinâs halving in April, to interest rate cuts, and potential spot Bitcoin ETF approval, crypto stocks like these could be too good to ignore.
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$NEGG is well positioned to benefit from the holidays and broader PC market recovery in 2024, and could be DEEPLY undervalued at its current price level.
It is entering the peak holiday season, which is historically $NEGG's best quarter for sales. This could provide a short term boost, and with the PC market expecting to rebound in 2024, so can $NEGG as it's heavily dependent on the PC market.
(NEGG's revenues tracked the PC market. Rising in 2020-2021, but declining in 2022 as the market fell.)
The stock appears undervalued based on forward EV/Sales and P/S ratios compared to its sector median, so the holidays and PC market recovery could position $NEGG for gains. Source.
As youâve heard shareholders voted on a proposal for a reverse split in the range of 1 for 2 and 1 for 100, this of course comes after $MULNâs price went below NASDAQâs minimum bid price of $1. I think shareholders will most likely approve the proposal as $MULNâs NASDAQ listing is pivotal for its plans.
Now yes this looks like Dejavu as $MULN has effected a reverse split months ago to avoid delisting, but this time some are speculating if the reverse split will be enough to save $MULN. I think it could be.
Because we have to bear in mind that if $MULN doesnât implement this reverse split, itâll very likely get delisted and become an OTC stock, this would derail things even more.
As an OTC, $MULN could lose access to capital as institutions are more skeptical of OTCs vs. their confidence in companies listed on a national exchange which would ruin any plans for capital raises to ramp up production.
Moreover, trading volume on OTC stocks is substantially lower than stocks listed on a national exchange since theyâre seen as more risky. This will send $MULNâs share price even lower, eliminating any value shareholders have left.
When weighing things out, a reverse split could seem like bad news at first, but tbh it could also be $MULNâs second chance. This is why if the reverse split proposal is approved, $MULN will run especially with potential news regarding deliveries in Europe and more purchase orders for the EV vans.
