Bitcoin Mining Marathon Digital To Join S&P SmallCap 600, Shares Jump 18%
Shares of Marathon Digital, the world's largest bitcoin (BTC) miner by market value, jumped 18 percent after confirming it was joining the S&P SmallCap 600 index fund.
S&P Dow Jones Indices said after trading on Friday, May 3, that Marathon will replace the heating and ventilation manufacturing company on May 8.
The S&P SmallCap 600 ranks 600 U.S. companies that posted profits between $1 billion and $6.7 billion in the most recent quarter and the last four quarters.
On Monday, May 6, Marathon Digital ( MARA ) shares rose 18% to $20.67, Google Finance reports.
Since April 20th, the stock price has increased by 25.2%, which rewards miners from 6.25 BTC to 3.125 BTC, which is $198,000 at current prices.
However, MARA is down 9.86% year-to-date, hitting a 2024 high of $31.03 on February 28.
With a market cap of $5.6 million and a float-adjusted market cap weighting method in the S&P SmallCap 600, Marathon may be one of the larger-weighted stocks.
Marathon's addition to the index comes as it prepares to post first-quarter earnings on May 9, with investment analyst Zacks expecting a 280% year-over-year (YOY) increase in revenue to $193.9 million and $0.02 earnings per share. – 166.7% YOY jump.
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Shares of Marathon's rival Bitcoin mining companies performed well on May 6, with CleanSpark ( CLSK ) and TeraWulf ( WULF ) seeing jumps of around 8% and 10.7%, respectively.
The increase in Bitcoin mining stock comes from the impact of the halving on the decrease in mining revenue.
Transaction fees were consistently above 3.125 BTC for the first few hundred blocks after the halving, effectively offsetting the halved new block subsidy.
However, transaction fees have fallen since then and are now hovering around 0.2 BTC to 1 BTC per block 842,350, according to mempool.space data.
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