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Should You Buy Cipher Mining (CIFR) Ahead of Q1 Earnings?
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Cipher Mining (CIFR - Free Report) will report its first-quarter 2024 results on May 7, before market open.
Let’s check out how CIFR has lately been doing.
Stock Performance & Valuation
The stock has gained 63.8% over the past year, outperforming the 55.8% rally of the industry it belongs to and the 23.6% rise of the Zacks S&P 500 composite.
On the basis of EV-to-EBITDA, CIFR is trading at 27.11X compared with the industry’s 58.09X. If we look at the Price/Earnings ratio, CIFR shares currently trade at 51.90X forward earnings, above the industry’s 41.77X.
2023 Sales & Margin Performance
The company had an exceptional year in 2023. Total revenues increased more than 100% to $126.5 million. Operating loss amounted to $20.1 million compared with the year-ago loss of $37.4 million. This significant improvement in the operating loss over the years demonstrates the company’s ability to improve operational efficiency.
Liquidity
CIFR’s current ratio (a measure of liquidity) was at 4.6 at the end of fourth-quarter 2023, higher than the preceding quarter’s 1.4 and the year-ago quarter’s 1.2. A current ratio of more than 1 often indicates that a company will easily pay off its short-term obligations.
Sales & EPS Growth Prospects
The Zacks Consensus Estimate for CIFR’s revenues for 2024 is pegged at $167.1 million, up 31.7% from the year-ago quarter. The consensus estimate for earnings is pegged at negative 15 cents per share, indicating a year-over-year decline of 50%.
To Conclude
Although CIFR trades at a discount relative to its industry based on EV-to-EBITDA, it looks expensive, based on P/E. The company’s liquidity position, based on the current ratio, remains healthy.
Since the stock has risen a whopping 63.8% in the past year, it may undergo a correction soon going forward for the upcoming first quarter results driven by revenues growth and lower cost of electric power consumption.
Moreover, CIFR does not seem poised for an earnings beat. Per our quantitative model, the combination of two key elements — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better — increases the odds of a positive earnings surprise. But that is not the case with CIFR, as it has an Earnings ESP of 0.00% and sports a Zacks Rank #1 (Strong Buy) at present.
Given this backdrop, it may not be a bad idea to wait for this fundamentally strong stock to undergo some correction and offer a better entry point rather than rushing to purchase the stock before earnings. This tactic will help you “Buy the Dip.”
Stocks to Consider
Here are a few stocks from the broader Business Services sector, which, according to our model, have the right combination of elements to beat on earnings this season.
Zeta Global (ZETA - Free Report) : The Zacks Consensus Estimate for the company’s first-quarter 2024 revenues is pegged at $187.1 million, indicating 18.7% growth from the year-ago quarter’s actual. For earnings, the consensus mark is pegged at 8 cents per share, suggesting a more than 100% rise from the year-ago quarter’s reported figure. The company has an average negative surprise of 39.6%.
Maximus (MMS - Free Report) : The Zacks Consensus Estimate for the company’s first-quarter 2024 revenues is pegged at $1.3 million, indicating a rise of more than 6% from the year-ago quarter. The consensus mark for earnings is pegged at $1.3 per share, suggesting a rise of 63.8% from the year-ago quarter’s actual. The company beat the consensus estimate in two of the past four quarters and missed in the other two instances, with an average negative surprise of 7%.
MMS currently has an Earnings ESP of +1.53% and a Zacks Rank of 2. The company is scheduled to post its first-quarter results on May 8.
Image: Bigstock
Should You Buy Cipher Mining (CIFR) Ahead of Q1 Earnings?
Cipher Mining (CIFR - Free Report) will report its first-quarter 2024 results on May 7, before market open.
Let’s check out how CIFR has lately been doing.
Stock Performance & Valuation
The stock has gained 63.8% over the past year, outperforming the 55.8% rally of the industry it belongs to and the 23.6% rise of the Zacks S&P 500 composite.
Cipher Mining Inc. Price
Cipher Mining Inc. price | Cipher Mining Inc. Quote
On the basis of EV-to-EBITDA, CIFR is trading at 27.11X compared with the industry’s 58.09X. If we look at the Price/Earnings ratio, CIFR shares currently trade at 51.90X forward earnings, above the industry’s 41.77X.
2023 Sales & Margin Performance
The company had an exceptional year in 2023. Total revenues increased more than 100% to $126.5 million. Operating loss amounted to $20.1 million compared with the year-ago loss of $37.4 million. This significant improvement in the operating loss over the years demonstrates the company’s ability to improve operational efficiency.
Liquidity
CIFR’s current ratio (a measure of liquidity) was at 4.6 at the end of fourth-quarter 2023, higher than the preceding quarter’s 1.4 and the year-ago quarter’s 1.2. A current ratio of more than 1 often indicates that a company will easily pay off its short-term obligations.
Sales & EPS Growth Prospects
The Zacks Consensus Estimate for CIFR’s revenues for 2024 is pegged at $167.1 million, up 31.7% from the year-ago quarter. The consensus estimate for earnings is pegged at negative 15 cents per share, indicating a year-over-year decline of 50%.
To Conclude
Although CIFR trades at a discount relative to its industry based on EV-to-EBITDA, it looks expensive, based on P/E. The company’s liquidity position, based on the current ratio, remains healthy.
Since the stock has risen a whopping 63.8% in the past year, it may undergo a correction soon going forward for the upcoming first quarter results driven by revenues growth and lower cost of electric power consumption.
Moreover, CIFR does not seem poised for an earnings beat. Per our quantitative model, the combination of two key elements — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better — increases the odds of a positive earnings surprise. But that is not the case with CIFR, as it has an Earnings ESP of 0.00% and sports a Zacks Rank #1 (Strong Buy) at present.
Given this backdrop, it may not be a bad idea to wait for this fundamentally strong stock to undergo some correction and offer a better entry point rather than rushing to purchase the stock before earnings. This tactic will help you “Buy the Dip.”
Stocks to Consider
Here are a few stocks from the broader Business Services sector, which, according to our model, have the right combination of elements to beat on earnings this season.
Zeta Global (ZETA - Free Report) : The Zacks Consensus Estimate for the company’s first-quarter 2024 revenues is pegged at $187.1 million, indicating 18.7% growth from the year-ago quarter’s actual. For earnings, the consensus mark is pegged at 8 cents per share, suggesting a more than 100% rise from the year-ago quarter’s reported figure. The company has an average negative surprise of 39.6%.
ZETA currently has an Earnings ESP of +21.43% and a Zacks Rank of 3. The company is scheduled to declare its first-quarter results on May 6. You can see the complete list of today’s Zacks #1 Rank stocks here.
Maximus (MMS - Free Report) : The Zacks Consensus Estimate for the company’s first-quarter 2024 revenues is pegged at $1.3 million, indicating a rise of more than 6% from the year-ago quarter. The consensus mark for earnings is pegged at $1.3 per share, suggesting a rise of 63.8% from the year-ago quarter’s actual. The company beat the consensus estimate in two of the past four quarters and missed in the other two instances, with an average negative surprise of 7%.
MMS currently has an Earnings ESP of +1.53% and a Zacks Rank of 2. The company is scheduled to post its first-quarter results on May 8.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.