5 Best Blockchain Stocks to Buy in July 2021

Blockchain stocks have been in the limelight over the last year amid the steep rise in cryptocurrencies. While crypto assets have been very volatile over the last three months and have come off their 2021 highs, most of them are up sharply over the last year.

Cryptocurrencies have reacted to the increasing global scrutiny as well as celebrity tweets. Tesla’s CEO Elon Musk’s tweets particularly have a market-moving impact on cryptocurrencies. What’re the five best blockchain stocks that you can buy in July 2021?

1. Riot Blockchain (NYSE: RIOT)

Riot Blockchain stock was up sharply in premarkets on 26 July. The stock has gained 70% so far in 2021 but is down sharply from the peaks. Riot Blockchain is a bitcoin mining company with operations in the US. With China cracking down on bitcoin mining in the country, stocks like RIOT could receive an impetus.

In May, RIOT announced the acquisition of Whinstone US. “The successful acquisition of Whinstone marks the most significant milestone in Riot’s history, and firmly establishes the Company as a leading Bitcoin mining platform,” said Jason Les, CEO of Riot. The company is a good play on the blockchain industry and looks attractive after the crash.

67% of all retail investor accounts lose money when trading CFDs with this provider.

RIOT looks like a good blockchain stock to buy

Earlier this month RIOT provided its June operational update. The company produced 243 bitcoins in June which was 406% higher than the corresponding month in 2020. The company produced 1,167 bitcoins in the first half of 2020 and held 2,243 bitcoins at the end of June. Notably, while some of the blockchain companies also purchase bitcoins from markets, all of the bitcoins that RIOT holds have been mined by it only.

The company also commented on China’s crackdown on bitcoin mining. “The exodus of Bitcoin mining from China has resulted in a downward difficulty adjustment and lower global network hash rate. As such, Riot is currently mining more Bitcoin per day than at any time in the Company’s history,” it said in the release. The company added, “While it is broadly expected that many Chinese miners will eventually relocate, the Company estimates that it could be quite some time before the global Bitcoin mining hash rate returns to its previous high of 180 exahash per second (“EH/s”), last observed earlier this year.”

RIOT valuation

RIOT stock trades at an NTM (next-12 months) PE of 27.3x which looks reasonable. However, the blockchain stock is not looking very bullish on the charts and trades below the 50-day, 100-day, and 200-day SMA. The 200-day SMA was a key support for RIOT stock but it fell below the level last week. The 14-day RSI (relative strength index) of 40.9 is a neutral indicator.

Wall Street analysts are also bullish on RIOT and all three analysts polled by CNN Business rate the blockchain stock as a buy. Its median target price of $48 is a 71% premium over current prices.

67% of all retail investor accounts lose money when trading CFDs with this provider.

3. Marathon Digital (NYSE: MARA)

Marathon Digital is another blockchain stock that looks like a good buy now. It’s a bitcoin mining company and produced 265.6 bitcoins in June which was 17% higher than what it mined in May. The company had a mining fleet of 19,395 miners in June which generated 1.09 EH/second.

“Given our current delivery schedule and the macro events affecting the global network hashrate, Marathon remains particularly well positioned to scale and thrive in the current mining environment,” the blockchain company said in its release.

At the end of June, MARA had 5,784 bitcoins which includes the 4,812.66 bitcoins that the company acquired in 2021 at $31,168 per coin. While bitcoins prices almost doubled from the levels, they soon plunged below $30,000. However, they have again risen on bottom fishing. Along with being a blockchain play, MARA is also a play on its massive bitcoin holdings.

MARA looks like a good blockchain stock to buy

MARA is facing resistance at the 50-day SMA but looks set to cross above the trendline on July 26 looking at the pre-market price action. The stock trades above the 200-day SMA and its next resistance could be the 100-day SMA which is currently at $32.26. The stock trades at an NTM PE multiple of 15.3x which looks attractive.

MARA has received a median target price of $50 from the analysts polled by CNN Business which implies an upside of over 103% over current prices. All three analysts covering the stock have a buy rating. Overall, looking at the bounce back in cryptocurrencies, MARA looks like a good blockchain stock to buy.

67% of all retail investor accounts lose money when trading CFDs with this provider.

3. Canaan (NYSE: CAN)

Canaan is a Chinese company that produces equipment for bitcoin miners. The stock has fallen sharply from the peaks and the crash looks like a good buying opportunity. The stock’s valuation multiples have come down from the peaks and it trades at an NTM EV-to-sales multiple of 5.82x.

The stock, however, is looking bearish on the charts and trades below the 50-day, 100-day, and 200-day SMA. Earlier this month, there was a death cross formation in the stock after its 50-day SMA fell below the 200-day SMA. Along with a sell-off in blockchain stocks, CAN has also been hit by China’s crackdown on crypto mining in the country.

CAN is a proxy blockchain play

While Canaan is not a pure-play blockchain stock, it’s an ancillary play as higher bitcoin mining would lead to higher demand for CAN products. The stock is a good blockchain play after the crash as the sell-off was likely overdone.

67% of all retail investor accounts lose money when trading CFDs with this provider.

4. Nvidia (NYSE: NVDA)

Nvidia is also an ancillary play on the blockchain industry as its graphics processing units (GPUs) are a key component for bitcoin mining. Analysts expect Nvidia’s revenues to rise 49% in the fiscal year 2022 which will end on 31 January 2022. The revenues had increased 52.7% in the previous fiscal year. Nvidia is among the beneficiaries of the increased pace of digitization, rising demand for online gaming, and growing demand from blockchain companies.

NVDA is a proxy blockchain play

Earlier this month, Nvidia went for a stock split. The stock rose sharply last year and is up almost 50% in 2021 and is among the top 25 gainers in the S&P 500. Last month, Raymond James had raised Nvidia’s target price. “We think pent-up demand from gamers who have been unable to get their hands on product for 9 months will drive demand, and underlying gaming demand appears to remain solid,” it said in its note.

Earlier this month, BMO raised the stock’s target price to a pre-split of $1,000. “For NVDA, we are raising our target price to $1,000 from $750, based on our confidence in the data center business as it continues to evolve from hardware to a hardware with a meaningful software component further out,” said BMO’s analyst Ambrish Srivastava. He added, “As we look further out to the company’s data center business, we now see the business growing to a $32 billion business a few years out vs. our prior expectation of $25 billion.”

NVDA is also looking bullish on the charts and trades above the 50-day, 100-day, and 200-day SMA.

67% of all retail investor accounts lose money when trading CFDs with this provider.

5. Coinbase (NYSE: COIN)

Coinbase is another ancillary play on the blockchain industry. The cryptocurrency exchange went public earlier this year through a direct listing. The stock has since plunged and trades below the direct listing reference price of $250. Meanwhile, the slump looks like a good buying opportunity considering the rebound in cryptocurrencies.

Coinbase has received a median price target of $335, which is a premium of 49% over current prices. Its highest price target of $650 is a premium of 189% over current prices, while its lowest price target of $225 is similar to current prices. Of the 19 analysts polled by CNN Business, 14 have rated it as a buy while four rates it as a hold. Only one analyst has a sell rating on the stock.

COIN is a good ancillary blockchain stock

Earlier this month, Oppenheimer reiterated COIN as outperform. “We continue to see a sharp dislocation between COIN’s fundamentals and its valuation and believe the current price offers an attractive entry point for long-term investors,” it said in its note.

However, Mizuho reiterated its neutral rating on COIN stock.” Following outsized trading volumes in April and May, the crypto winter that began in June still reigns as 3Q knocks on the door. While 2Q volumes should be elevated, meager crypto volumes lingering bodes poorly for the remainder of 2021,” it said in its note.

Meanwhile, COIN stock looks attractive after the crash and trades at 7.5x its 2021 expected revenues. While there are headwinds like increasing competition and the contraction of margins, they seem baked at current prices. Overall, COIN looks like a good ancillary blockchain stock to buy now.

67% of all retail investor accounts lose money when trading CFDs with this provider.