The Riot Blockchain (NASDAQ: RIOT) stock price crashed by more than 10% in premarket trading as investors reflected on the company’s quarterly earnings and the weak Bitcoin prices. The stock was trading at $37.50 before the market opened, meaning that it has dropped by more than 50% from its highest level this year.
RIOT earnings
Riot Blockchain is an American mining company that operates in Rockdale, Texas and in New York. The company mined 465 BTC in October, bringing the total year-to-date production to 2,921. Going by the current Bitcoin price, these coins are worth more than $175.2 million. The firm has about 27,270 miners.
The company published results for its third-quarter earnings on Monday. These results showed that the company’s revenue surged to a record $64.8 million in the third quarter. This was significantly higher than the $2.5 million that it generated in the third quarter of 2020.
By segment, the company’s mining revenue rose to more than $53.6 million. The rest amount came from the overall Bitcoin price jump.
Still, like so many young companies, Riot Blockchain is still in the red. Its net loss rose to more than $15.3 million, which was higher than the previous $1.5 million. Its average BTC price in the third quarter was about $41,837.
The Riot stock price is also falling because of the overall price of Bitcoin price has crashed. BTC is trading at about $60,400, which is substantially below the all-time high of almost $70,000.
So, what next for the Riot Blockchain stock price? To be honest, the company’s future is relatively uncertain.
For one, Bitcoin mining will continue getting more difficult in the future. As such, the company will need to keep investing in newer miners, which will be expensive. Also, the price will always depend on the movement of BTC prices. Still, analysts at DA Davidson believe that the stock will rise to more than $80.
Riot stock price forecast
On the daily chart, we see that the Riot stock price found a strong support at $25 a few weeks ago. It struggled moving below this level several times between May and October. Now, the stock has moved above the 25-day and 50-day moving averages. It has also moved above the key resistance level at $40.
Therefore, despite today’s dip, the stock remains solidly in a bullish trend for now. There is a likelihood that it will retest the year-to-date high of $80.
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