Summary Upgrading MARA Holdings to a 'Strong Buy' on record Q2 results and a favorable Bitcoin setup going into the back half of the year. MARA posted $238.5M in Q2 revenue (up 64% YoY), a $1.2B gain on digital assets, and surpassed 50,000 BTC holdings. The Street projects 93% top-line growth in Q3. Tailwinds for BTC include lower interest rate expectations, with CME projecting two more cuts before year-end, and strong institutional Bitcoin demand as noted by ETP ownership. Returns are tied to BTC. Therefore, a stronger USD or slower-than-expected Fed cuts due to tariff-driven inflation could pressure Bitcoin and make me reassess my rating. I resume my coverage on MARA Holdings, Inc. ( MARA ), upgrading this stock to a strong buy after record Q2 results and a clearer setup for Bitcoin following the decline during the tariff selloff earlier this year. Let me first clarify my strong sell rating from March. Back then, we were in the midst of the tariff selloff, and I didn't see any compelling reasons to own this stock, considering the headwinds at that time that I noted in that article (mainly the fear of tariff-driven inflation, leading to persistently high interest rates). Considering that the stock sold off by 35% from the moment of writing that article to the lows in April, I believe I was correct with my rating. The main reason I didn't revisit this stock after the April 9 tariff pause (when the market realized that the dreaded tariffs presented on April 2 were a mere negotiation tool) was due to my focus on the semiconductor sector. To be direct, I would have reconsidered my strong sell rating on Mara after April 9. That said, I have revisited the stock and the crypto industries, and I was in for a pleasant surprise. I discuss the details of my bull case below. Record Q2 Results The Q2 quarter was one of the best quarters in the company's history. The company reported $238.5 million in revenue, up 64% yoy. To put that figure into perspective, this was the highest quarterly revenue in the history of the company. Seeking Alpha Looking at the bottom line, net income was $808.2 million, compared to a loss of $199.7 million in Q2 2024. This turnaround was driven by a $1.2 billion gain on digital assets as Bitcoin prices increased by approximately 60% in that period. From a production perspective, the company mined an average of 25.9 BTC/day compared to 22.9 BTC/day in the previous quarter. This is equivalent to an increase of 300 BTC on a QoQ basis, which makes sense in my view, considering the recovery in Bitcoin prices after the tariff-driven selloff in Q1. TradingView Furthermore, the number of blocks that the company won increased by 52%, with May being the best month in the company's history. Interestingly enough, that's exactly when the turnaround in BTC prices began (see the chart above). From a Bitcoin holdings perspective, the company surpassed 50,000 BTC post-quarter , remaining the second largest public holder in the world. Mara Furthermore, the market value of their Bitcoin holdings increased by $4.2 billion yoy, or 362%. Moving on now to the balance sheet, the company issued $950 million 0% convertible senior notes due in 2032. Mara 10-Q Q2 2025 By the way, that convertible debt offering was upsized , likely due to strong demand. Additionally, the company has over $5 billion in liquid assets, which I believe will be used to purchase more BTC. Why? Take a look at the BTC/USD chart below. TradingView I see price consolidation between the $100k and $125k range. This pattern is ultra bullish, especially when one takes into account the tailwinds in the crypto space. The main one is the consensus towards lower interest rates, as noted in the chart below by the CME Group. CME Group Traditionally, lower interest rates were a tailwind for Bitcoin as more liquidity hit the market and some of it spilled over to risky assets. This is especially the case now, considering the institutional ownership of Bitcoin through U.S.-listed spot Bitcoin ETPs like IBIT holding 747k BTC and FBTC holding about 200k BTC. Valuation Moving on to valuation , I see an attractive forward P/CF multiple, sitting at 14.8 at the time of writing this article. In comparison, Riot is trading at 16.6x next year's operating cash flow. Furthermore, the P/E multiple is quite attractive, particularly on a TTM basis, with the stock trading at 10.8x last year's earnings (65% below the sector median). Again, if we were to compare this multiple with Riot's, Mara wins again, as Riot is not profitable (yet), so there are no earnings in the denominator of P/E. Furthermore, if we look beyond valuation and consider the Street's estimates for the top line of the company, one can find a (very) pleasant surprise. Seeking Alpha As seen above, the Street is projecting a spectacular Q3, with a 93% YoY increase in revenue at the midpoint. Overall, I see a nicely valued company with decent growth prospects ahead. That said, there are some risks to consider. Risks In the last earnings call, CEO Fred Thiel noted the following regarding the price of Bitcoin: Regarding the current price of bitcoin, our view is that things feel a little frothy at the moment. I believe he may be referring to the consolidation phase between $100k and $125k that I mentioned earlier. He further added: Supply is currently being absorbed relatively well. But if the buying demand were to subside, we could see downward pressure as sellers attempt to lock in gains at these high price points Considering that the company was holding approximately 50,000 BTC at the time of the Q2 conference call, the returns of the stock are correlated to the price of BTC. So far, I see tailwinds for a deterioration in the price of the dollar, as noted by the deterioration of the DXY since the start of the year. TradingView However, if there is a turnaround in the US dollar, accompanied by a slowdown in interest rate cuts by the Fed, I may have to reconsider my strong buy rating on this stock. Conclusion To wrap up, when considering all the factors above, I believe Mara deserves a strong buy rating. We're talking about the second-largest holder of BTC in the world, with strong tailwinds that could lead to a breakout in Bitcoin's price beyond the $125k resistance. Specifically, I am bullish on further interest rate cuts, as I believe unemployment in the US will only tick up from here due to the broader adoption of AI among enterprises (a topic I vividly discussed in my macro articles ). On a company-wide basis, I see solid double-digit growth in the topline, and unlike competitors like Riot, Mara has a positive EPS. The Street is projecting 93% YoY growth in Q3, with double-digit growth moving into 2026. On a valuation basis, the company looks quite attractive. Overall, I believe Mara is a strong buy at this price level.
