Recommendation: Speculative Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Potential Upside |
|---|---|---|---|---|---|---|---|
| 14 Nov, 24 | BITF | Speculative Buy | USD 2.27 | USD 2.46 | USD 2.54 | 5 days | 11.9% |
Data Powered by EOD Historical Data (“EODHD”).
Bitfarms Ltd. engages in the mining of cryptocurrency coins and tokens in Canada, the United States, Paraguay, and Argentina. It owns and operates server farms that primarily validates transactions on the Bitcoin Blockchain and earning cryptocurrency from block rewards and transaction fees. The company also provides electrician services to commercial and residential customers in Quebec, Canada. It also undertakes hosting of third-party mining hardware. The company was formerly known as Bitfarms Technologies Ltd and changed its name to Bitfarms Ltd. in October 2018. The company was founded in 2017 and is based in Toronto, Canada.
Increasing Cash Balance: Cash & Equivalents of USD 138.6 mn in Q2 FY24 vs USD 30.9 mn in Q2 FY23
Enhanced Liquidity: Current Ratio of 5.11x in Q2 FY24 vs Industry Median of 1.71x
Negative Profitability: Gross Profit of USD -11.28 mn in Q2 FY24
Declining Sequential Revenue: Net Sales of USD 41.55 mn in Q2 FY24 vs USD 50.32 mn in Q1 FY24
Hardware Obsolescence, Concentration in Bitcoin Mining, Electricity Source Stability, Regulatory Compliance, etc
| Entry Price | Support* | Target 1 | Target 2 |
|---|---|---|---|
| 2.27 | 2.05 | 2.46 | 2.54 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
BITF's stock price has broken out of its declining trendline and is currently trading near its trendline support levels, indicating a potential reversal and the possibility of an upward movement. The 14-day Relative Strength Index (RSI) is below the midpoint, suggesting a likely pullback that could set the stage for a rally. Additionally, both the 21-day and 50-day Simple Moving Averages (SMAs) are situated below the midpoint, reinforcing the bullish sentiment, with these levels serving as immediate support.
As per the above-mentioned technical indicators analysis, a ‘Speculative Buy’ rating has been given to Bitfarms Ltd. (NASDAQ: BITF) at the closing market price of USD 2.27 as of November 13, 2024.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Financial Services Industry: Capital Markets
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| BITF Bitfarms Ltd |
-0.0912 5.43% | 1.59 | - | 84.03 | 5.58 | 2.11 | 5.30 | 58.96 |
| MS Morgan Stanley |
-0.225 0.18% | 123.22 | 16.50 | 13.76 | 2.80 | 1.65 | ||
| SCHW Charles Schwab Corp |
-0.315 0.42% | 74.00 | 22.86 | 17.39 | 6.14 | 4.28 | ||
| GS Goldman Sachs Group Inc |
-2.2467 0.40% | 563.85 | 18.44 | 10.60 | 2.83 | 1.16 | ||
| CIIHY CITIC Securities Co Ltd ADR |
- -% | 30.18 | 15.86 | 7.89 | 0.98 | 1.07 | 10.27 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is November 13, 2024. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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