The 3 Best Crypto Mining Stocks to Buy in February

The crypto winter was excruciatingly painful. For investors who plunged near highs, the losses have been significant. However, there is some good news. In fact, if we look at the positive side of the story, the extended bear market has weeded out the fundamental weak stories. And given current valuations, it could be a good time to buy quality cryptocurrencies and some of the best crypto mining stocks.

There is a possibility of a global recession in 2023. The dollar has already weakened from highs, as contractionary monetary policy is unlikely. On the contrary, there may be a possible case for renewed expansionary policies in a recessionary scenario. This will be positive for cryptocurrencies. With a relatively bullish outlook, let’s talk about the best crypto mining stocks to buy at current levels.

Riot Platforms (RIOT)

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The Riot Platforms (NASDAQ:RIOT) Mines is possibly the best crypto mining stock to consider. After a 71% correction over the past 12 months, RIOT stock appears poised for a major reversal rally. In January, Riot reported hash rate capacity of 9.3EH/s. For the month, the company mined 740 Bitcoin. Riot expects to increase capacity to 12.5EH/si in the first half of 2023. Digital assets will therefore continue to swell the company’s balance sheet.

Another reason to like Riot is strong fundamentals. As of the third quarter of 2022, the company had zero debt and $255 million in cash. Balance sheet remains strong after navigating through crypto winter. This positions the company for the next stage of expansion in the second half of 2023. It’s also worth noting that for the first nine months of 2022, Riot reported a gross margin of 65.4%. As Bitcoin trends higher, the company will be positioned to generate healthy cash flows.

Hive Blockchain (HIVE)

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Hive Blockchain (NASDAQ:HIV) is another name among the top crypto mining stocks positioned to survive and grow. The stock is lower by 73% on a 12-month basis. In the last month, however, the share has risen by 40%. The rally is likely to continue from deeply oversold levels. For Q2 2023, Hive Blockchain reported revenue of $30 million and $18.8 million in adjusted EBITDA. The key point to note is that Hive has followed steady growth in hash rate. Furthermore, Hive is a diversified miner with Ethereum (ETH-USD) mining activity also contributes to growth in digital assets.

As of January 2023, the company reported a 25% month-on-month growth in hashrate capacity. It is expected that capacity will continue to increase in the coming months, and this will lead to higher digital assets. Another point to note is that Hive reported a gross margin of 54% for Q2 2023. On a year-over-year basis, GMM fell 3,200 basis points. With Bitcoin recovering from lows, margin expansion can be expected in the coming quarters.

Marathon Digital (MARA)

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Digital Marathon (NASDAQ:MARA) share has risen by 20% in the last month. I expect the upside to be sustained if Bitcoin continues to trend higher. It is worth mentioning that the MARA share has short interest of around 40% of the free float. I see the stock as a potential short squeeze candidate. As of January, Marathon reported an installed hash rate of 11EH/s. The company continues to guide for an increase in hash rate to 23EH/s by mid-2023. Even if the target is delayed by a quarter or two, the growth outlook is positive.

As for concerns, Marathon reported negative adjusted EBITDA for the first nine months of 2022. The company’s revenue has also declined sharply. However, a reversal in the trend seems imminent, and it is likely to trigger a sharp rally. From a fundamental perspective, the company’s cash and digital assets will ensure that the challenging times are navigated.

At the date of publication, Faisal Humayun did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to the InvestorPlace.com Publishing Guidelines.