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3 cryptocurrency stocks that have outperformed Bitcoin since 2023

Do Kwik
15. 5. 2024
5 min read

Over the past year, we have seen some cryptocurrency companies grow extraordinarily and have managed to significantly increase their market value. This staggering growth has attracted the attention of investors and raises questions about the sustainability of such returns in the future. Different companies differ in the extent to which they are exposed to cryptocurrencies, resulting in significantly different risk profiles.

Some of these companies specializing in cryptocurrencies offer not only direct investments in digital currencies, but also a wide range of services and technologies that support the entire sector. Although Bitcoin and other cryptocurrencies are reaching record highs, with growth of just under 300% since 2023, there are three companies that have yet to surpass these feats.

Coinbase Global $COIN+3.1%

Coinbase Global, one of the leading cryptocurrency exchanges, has maintained a strong market position since 2023. During this period, the firm has seen significant growth in market capitalization, reaching 49 billion $49 billion. This rise is supported by the growing popularity of cryptocurrencies among the general public and investors, which is reflected in the total volume of trades the firm has recorded.

COIN
$245.00 $7.35 +3.09%
Target Price
181.73 (-25.82% Downside)

Last year, Coinbase Global posted a profit 94.7 million USD, a significant improvement from the loss of USD 2.6 billion in 2022, which was mainly attributed to cost cutting and the absence of high depreciation charges. Investors should be cautious, however, as Coinbase Global shares are trading with a P/E of 39, which may indicate their relatively high valuation. Even so, many analysts consider the stock to be still attractive investment with long-term potential, especially for those who are optimistic about the future of cryptocurrencies.

COIN
$245.00 $7.35 +3.09%

Since Coinbase Global does not depend solely on bitcoin but offers a broad portfolio of cryptocurrencies, it provides investors with the opportunity to diversify their cryptoassets. This is important because even though bitcoin remains the most popular digital currency, its share of total trading volume on Coinbase in 2023 was only 34%. This diversification, along with the variety of services offered, including subscription and transaction services, which account for roughly half of their revenue, provides the company with a more stable financial base and reduces its dependence on fluctuations in individual cryptocurrencies.

CleanSpark $CLSK+0.3%

CleanSpark, a company specializing in bitcoin mining, is known for its ability to effectively navigate the dynamic cryptocurrency landscape. In 2023, revenue grew to $168.4 million, which was an increase of 28% from the previous year. This turnaround was made possible not only by increased interest in cryptocurrencies and the rise in their prices, but also by more efficient operations and strategy cost reduction. In addition, the company recorded a profit of $36 million on the fair value of bitcoin, which helped to achieve a positive result.

CleanSpark's capitalization this year is 3.5 billion dollars, reflecting a significant increase from previous periods. The company is characterized by aggressive investing in the development of its mining operations and technology, allowing it to remain competitive even in periods when the bitcoin price is not stable. The company's daily stock range is between $15.55 and $18.08, with a 52-week from $3.3 to $24.7, indicating high volatility and providing investors with both significant opportunities and risks.

CLSK
$17.69 $0.06 +0.34%

Despite the recent "halving"which has reduced the amount of newly generated bitcoins and increased their value, CleanSpark continues to strive to optimize its operations and maximize profits. CEO Zach Bradford emphasized that with strong operating margins and mining efficiencies, he expects the company to maintain its position despite the reduced amount of bitcoins mined. The firm expects its share to increase by up to 20%, indicating confidence in their ability to adapt and innovate.

MicroStrategy $MSTR-0.6%

MicroStrategy, a company known for its fundamental focus on cryptocurrencies, especially bitcoin, has become one of the largest corporate holders of this digital currency. At the end of 2023, the company announced that it owned more than 214,000 bitcoinsmaking it a key player in the cryptocurrency space. However, this vast amount of digital assets also comes with significant risks, as the financial results of recent years have shown. In 2023, the company made a profit thanks to a tax benefit of $429 million, which was crucial to achieving a positive financial result, while in the previous year the company suffered a loss from the impairment of digital assets of $1.4 billion.

MSTR
$1,675.35 -$9.49 -0.56%
Target Price
255 (-84.78% Downside)

MicroStrategy CEO, Michael Sayloris known for his bullish attitude to bitcoin, which he often compares to gold, but with far more attractive characteristics and without its drawbacks. This enthusiasm is reflected in the company's strategy, which sees cryptocurrencies as not only an investment opportunity but also a core element of its business model. Saylor's belief in bitcoin's long-term potential as a "digital gold" is key to understanding the investment decisions of a company that continues to accumulate crypto-assets despite large fluctuations in their value.

MSTR
$1,675.35 -$9.49 -0.56%

However, MicroStrategy's financial performance remains a matter of debate among investors. With a market capitalization that far exceeds 800 times of their expected future earnings, it is evident that the company's market valuation is heavily influenced by by its bitcoin holdings. While the firm has shown the ability to turn a profit in 2023, the underlying operations remain loss-making. This could pose a significant risk to investors should the a price decline bitcoin or changes in cryptocurrency regulation.

Disclaimer: There is a lot of inspiration to be found on Bulios, but stock selection and portfolio construction is up to you, so always conduct thorough self-analysis.

Source.

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