Will Riot Blockchain Stock Extend Its Downtrend After Earnings?

RIOT is slated to report earnings on Monday, May 10

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Riot Blockchain, Inc. (NASDAQ: RIOT) is a cryptocurrency mining company. RIOT primarily focuses on the mining of bitcoin. Riot Blockchain also holds investments in blockchain technology companies. RIOT is headquartered in Colorado, and the company’s mining facility operates out of New York. At last check, RIOT was trading up 1.3% at $33.87.

Last month on April 8, Riot announced the acquisition of Whinstone, including all of its assets and operations. Whinstone is the owner and operator of North America’s largest Bitcoin hosting facility. As explained in the company’s press release, Riot views Whinstone as a foundational element in its strategy to become an industry-leading Bitcoin mining platform on a global scale. Riot Blockchain reportedly acquired Whinstone for $80 million in cash, plus a fixed 11.8 million shares of RIOT common stock.

Despite Riot Blockchain stock’s downward trend from mid-February, the stock is still up a massive 2,500% from its May 2020 low of $1.27. Additionally, shares of Riot Blockchain stock have tacked on 96% year-to-date. However, the security price remains down 58% from its February high of $79.50.

Moreover, Riot Blockchain is scheduled to report quarterly earnings before the open, Monday, May 10. RIOT has outperformed earnings expectations on three of its last four earnings reports released. For the first quarter of 2020, Riot Blockchain stock beat analysts’ estimates by a margin of $0.04 and reported an earnings per share (EPS) of -$0.15. For the second quarter of 2020, RIOT's EPS decreased to -$0.31 and missed expectations by a margin of $0.14. For the third quarter of 2020, Riot Blockchain reported an increase in earnings, rising to -$0.04 per share and outperforming estimates by a margin of $0.04. In the most recent quarterly report, Riot Blockchain posted an EPS of $0.16 and beat expectations by a margin of $0.24. Analysts estimate an EPS of $0.20 or the upcoming report.

Fundamentally, Riot Blockchain still has the makings of a growth stock after its amazing growth over this past year and the huge interest growth in cryptocurrency lately. The company is currently enterprise valued at $2.58 billion and has a forward price-earnings ratio of 17.15. Overall, Riot Blockchain stock is a great stock-based alternative to buying cryptocurrency directly for long-term believers of cryptocurrency growth.

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