The key metric backing Mellerud’s claim is enterprise value-to-sales ratio \u2014 measuring a company’s value to its sales revenue. The higher the ratio, the more overvalued a company is.<\/p>\n
The miners with the highest EV\/S ratios are Cipher at 7.8, Marathon and Iris Energy each at 5.6 and Riot at 5.5, according<\/a> to a Nov. 3 report by Mellerud.<\/p>\n Mellerud attributed the heavyweight\u2019s high EV\/S ratios to receiving more institutional attention from the likes of BlackRock.<\/p>\n \u201cThese companies have historically been favored among institutional investors like Blackrock and Vanguard, giving them superior access to capital and higher valuations like the rest of the industry.\u201d<\/p><\/blockquote>\n Mellerud told Cointelegraph in the coming months he expects investors to start allocating to other players “which could even out the valuation discrepancies between these stocks,\u201d he said.<\/p>\n He suggested there are better-priced opportunities with lower EV\/S ratios that could be capitalized on.<\/p>\n \u201cThere exist immense valuation discrepancies in the Bitcoin mining sector that value investors can take advantage of.”<\/p><\/blockquote>\n Riot\u2019s high EV-to-Hashrate ratio at 156 is another indicator pointing toward its overvaluation, says Mellerud.<\/p>\n Mellerud, previously an analyst at Bitcoin miner Luxor Technology<\/a>, noted Riot has \u201cmassive growth\u201d priced in as it\u2019s constructing its a gigawatt site and awaits the delivery of 33,000 MicroBT machines in early 2024.<\/p>\n \u201cIn addition, Riot has several business lines that are not reflected in its self-mining hashrate, meaning we should be careful in drawing any valuation conclusions from its high EV-to-Hashrate ratio,\u201d Mellerud added.<\/p>\n The Bitcoin mining sector has rebounded strongly in 2023, led by Marathon (MARA) and Riot (RIOT), whose share prices have respectively increased 170% and 228%, according to Google Finance.<\/p>\n The mining stocks have outperformed Bitcoin over the same time, which has gained 113% year-to-date according to Cointelegraph Markets Pro data.<\/p>\n Related: <\/em><\/strong>Bitcoin mining can help reduce up to 8% of global emissions: Report <\/em><\/strong><\/p>\n Not every mining analyst believes Bitcoin mining stocks will continue to rise.<\/p>\n Cubic Analytics founder Caleb Franzen noted<\/a> Bitcoin already reached its year-to-date peak price, while the top mining stocks are still over 75% off year-to-date price highs.<\/p>\n Franzen considered whether Bitcoin mining firms will soon need to become twice as productive in light of the upcoming Bitcoin halving event.<\/p>\n \u201cIf block rewards are cut in half, the price of BTC would need to double post-halving in order for their business to be just as sustainable as it was pre-halving.\u201d<\/p><\/blockquote>\n Marathon has the largest Bitcoin holdings among mining companies with 13,726 BTC, worth $486.1 million. Hut 8, Riot and CleanSpark follow with respective holdings of 9,366 BTC, 7,309 BTC and 2,240 BTC.<\/p>\n Magazine:<\/em><\/strong> <\/em><\/strong>How to protect your crypto in a volatile market: Bitcoin OGs and experts weigh <\/em><\/strong><\/p>\n <\/template><\/div>\n If you liked the article, do not forget to share it with your friends. Follow us on\u00a0Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n For forums sites go to Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n If you want to read more News<\/a> articles, you can visit our General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n![](\"https:\/\/s3.cointelegraph.com\/uploads\/2023-11\/fe51c176-8350-4089-8901-90a09673c965.png\")
![](\"https:\/\/s3.cointelegraph.com\/uploads\/2023-11\/f4e58c71-dbeb-413f-97fc-17cf16d22e31.png\")
\n
\n