Looking for Bitcoin Exposure? Analysts Select 2 Bitcoin-Focused Stocks to Buy
Wednesday, Feb 19, 2025 5:55 am ET
4min read Bitcoin, the world's most popular cryptocurrency, has been on a rollercoaster ride in recent years, with its price surging and plummeting in dramatic fashion. While investing directly in Bitcoin can be risky due to its volatility, there are alternative ways to gain exposure to the cryptocurrency market through stocks. Two Bitcoin-focused stocks that analysts recommend for investors seeking exposure to the cryptocurrency market are MicroStrategy (MSTR) and Marathon Digital Holdings (MARA).
MicroStrategy (MSTR) is a business intelligence and analytics software company that has gained significant attention for its Bitcoin holdings. The company has been actively buying and holding Bitcoin, with a current total of 132,500 BTC on its balance sheet. This strategy has significantly increased the company's value, as Bitcoin's price has surged over the past few years. MSTR's stock price has closely tracked Bitcoin's price movements, making it an attractive option for investors looking to gain exposure to the cryptocurrency market.
Analysts have given MSTR strong buy ratings, with a consensus price target of $87.20, indicating significant upside potential. The company's performance has been impressive, with a 12-month return of 128.04% compared to the S&P 500's 25.31%. MSTR's risk-adjusted performance is also strong, with a risk-adjusted rank of 92, placing it in the top 8% of cryptocurrency stocks on the website in terms of risk-adjusted performance.
Marathon Digital Holdings (MARA) is a Bitcoin mining company that focuses on generating new Bitcoins through a process called mining. As the price of Bitcoin increases, the value of the mined coins also rises, driving the company's revenue and profitability. MARA's stock price has also been closely correlated with Bitcoin's price movements, making it another attractive option for investors seeking exposure to the cryptocurrency market.
Analysts have given MARA moderate buy ratings, with a consensus price target of $15.65, suggesting potential upside. The company's performance has been solid, with a 12-month return of 34.52% compared to the S&P 500's 25.31%. However, MARA's risk-adjusted performance is lower than MSTR's, with a risk-adjusted rank of 93.
Investing in Bitcoin-focused stocks like MSTR and MARA can provide investors with exposure to the cryptocurrency market while mitigating some of the risks associated with direct investment in Bitcoin. However, it is essential to consider the risks associated with these stocks, such as market volatility, regulatory uncertainty, and company-specific risks. Diversifying your portfolio and staying informed about the latest developments in the crypto market can help investors make informed decisions about their investments.
In conclusion, MicroStrategy (MSTR) and Marathon Digital Holdings (MARA) are two Bitcoin-focused stocks that analysts recommend for investors seeking exposure to the cryptocurrency market. Both stocks have shown strong performance and have been closely correlated with Bitcoin's price movements. However, investors should be aware of the risks associated with these stocks and consider diversifying their portfolios to manage risk effectively.
Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.
