MARA is held for cash flow generation via covered calls rather than upside potential, given its weak fundamentals and correlation to Bitcoin.
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Terry is saying, "Broken record here. Can you give me fair value of MERA and any new thoughts? I've stopped selling covered calls at $13." Um man, I have been I've been adding a little bit to my MERA position.
Mer's high risk of performing badly. Its valuation is actually a B. Its growth is an F. Its profitability is an F. So these are these are Bitcoin miners. You know, they're they're having a hard time with Bitcoin prices being down in the dumps. Um quant rating is a sell.
So let's look at the ratings here. We were a hold. We were a strong sell at 920 and then we're a sell at 1126. So, it's interesting that it was like rating a a a strong sell at 921.
Seeking Alpha specifically, I've watched Seeking Alpha for a very long time. You'll see this pretty frequently. You'll see that we'll get oh, the momentum is going poorly. Um, we are going the stock is going down.
This becomes a strong sell. So, you can see this on the slope. It's like it's coming down. It becomes a cell as it comes down. It's like it switched to a hold here just at the bottom.
That's pretty rare. Like this this is more frequent I would say. You see these like buy ratings as the stock's coming down and then um the strong cell kicks in before it goes back up.
So we're we're potentially in that same sort of scenario right now where we're holding for a while and then we have this strong sell followed by a sell rating. We see we've seen this like history potentially repeating itself.
The reality is this stock doesn't matter. It doesn't matter what's going on behind the scenes. It only relies on Bitcoin. That's it. So if you're bullish Bitcoin, then holding something like Mera gives you a exposure to Bitcoin.
That's how it functions. It's hasn't functioned any other way.
Now fair value $12.13. That's what you're asking for. Investing.com. That's up to upside of 18.8%. Now the cool thing about this um it's quickly burning through crash. It may even have trouble making interest payments. stock has taken a big hit.
Uh as analysts anticipate sales decline, like there's a bunch there's a bunch of negative about this. This is definitely not like a like a golden goose stock.
You know, this is but I can tell you from experience, this stock has been one of my largest position returners in terms of percentage over the last four years. So over the if we were to look, let's go back three years here, it it hasn't really moved.
If we looked back at October, let's go back to uh we're at September right now, right? So September 1st, September 1st of 2023. That was 3 years ago. And I can't seem to get it here exactly, but we're we're trading right around 1347.
So the stock has lost 25% of its value since that time.
I have been holding shares through this whole trading position here. And this my position returns 24% a year. And the reason that it returns 24% of a a year is because I am not shy about capping my pro my capping my upside. I care more about cash flow than anything else.
And when I look at the options chain, if I go to mumu here, if I look at the 3-day chain, the selling the 12 call, if I was to own shares or buy shares at this point right now, selling that 12 call gives me a uh a measly return.
Three 3 days, 3 cents. It's nothing. Let's go out one more week. Let's look at the 10 days to expiration. This 12 call gives me almost 1% return on capital.
So, there are not a lot of positions out there on a tiny tiny little stock where I could buy $1,000 worth of stock. I could cap my return at 20% upside and I can collect 1% over 10 days and I might feel like a broken record because I've been trading this so long and I've been posting my alert service so much about MEA over the years and how I roll these positions and what do I do with them?
I do not care about upside on this at all. What I care about is cash flow. And the crazy thing is that it's just so cheap. So when you get into a small position, let's just say you were buying a,000 shares of this.
So you buy a,000 shares for 10 bucks. It's $10,000 investment. If I was to sell these calls each week, I get 10 10 options times 10 cents is a h 100red bucks. If I was to then turn around and I was to to use that $100 to buy shares each week, my 1,000 share position would be growing by 10 shares a week.
Maybe nine shares I get to buy this week. And what that does is it just snowballs over time.
There are not a lot of positions out there that have the consistency that Marathon has. And if there is, I would love to know about them. Please comment.
Now, of course, small companies like Marathon, we saw it. there is a high risk of of performing badly. Let's for just one moment I'm going to go back to marathon. I'm going to just show you the at the money position.
let's go to Marathon 10 days out. Let's sell the let's sell the 10 uh covered call. If I was to buy the shares right now at 10:25 and add the stock in here, buy.
This position, this is a simulated, this is a synthetic uh synthetic short put is what we call this. It's got a 60 cent 66% probability of money of pro probability of profit. It makes $37.50 on a $962 potential risk.
This has a greater profit probability of making that money and the return is still spectacular.
Marathon is not not against that. It could easily go down.
What this channel has said about $MARA
Drawbridge Finance has only this one call on this stock.