How is the market valuing the public bitcoin miners?
Different growth expectations lead to considerable differences in how public mining companies are valued.
Apr 11th 2022
Source: Yahoo Finance, March production updates (Marathon, Riot, Hut 8, Core Scientific, Bitfarms)
We can compare the valuations of mining companies using the industry metric Price/Hashrate. A miner’s hashrate is their capacity to produce bitcoin. Therefore, Price/Hashrate considers future earnings, and we can view the metric as a simplified version of the Forward Price/Earnings ratio.
The most expensive mining stock based on Price/Hashrate is Marathon. Investors are pricing in massive future hashrate growth, as the company has enormous machine orders waiting to be plugged in.