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3 Blockchain Stocks to Add to Your Watchlist in July 2024
Wall Street’s focus on blockchain stocks will likely continue into the second half of 2024. Blockchain, the technology behind cryptocurrencies such as Bitcoin (BTC-USD exchange rate) AND Ethereal (ETH-USD), has applications that go far beyond digital currencies. In fact, many publicly traded companies are integrating blockchain into their operations or offering related services.
Recent research suggests that the blockchain technology market is expected to grow from $7.4 billion in 2022 to $94 billion by 2027, with a compound annual growth rate (CAGR) of over 66%. The potential of blockchain spans various sectors, from Authentication of luxury goods TO fight against illegal fishing and wildlife trafficking. Also the The Vatican has ventured into blockchainusing non-fungible tokens (NFTs) to digitize and preserve artistic and historical documents. So today, we explore two top blockchain stocks and a blockchain exchange-traded fund (ETF) to add to your list of stocks to watch in July.
Spark Cleanup (CLSK)
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The first name in our range of blockchain stocks is Clean spark (NASDAQ:CLSK), a bitcoin mining company with a commitment to sustainability. Its data centers operate predominantly on low-carbon energy.
In the second quarter of fiscal year 2024CleanSpark generated record revenue of $111.8 million, up 163% year-over-year (YOY). Net income rose to $126.7 million, resulting in EPS of 59 cents, a significant improvement from the prior year’s loss of 23 cents. Ending the quarter with solid financial health, CleanSpark boasted $632.7 million in working capital and minimal debt of $12.8 million.
CleanSpark has cleverly expanded the post-Bitcoin Halving acquiring competitors and strengthening its presence in the mining sector. Recent acquisitions, including two locations in Wyoming AND five in Georgiahave increased their hashrate to over 20 exahashes per second (EH/s), aiming for 50 EH/s by 2025. Hashrate, which measures mining efficiency, has a direct impact on the chances of earning rewards. Meanwhile, the recent acquisition announcement GRIID Infrastructure (NASDAQ:GRDI) further improves its market position, targeting 100 megawatts (MW) of capacity in Tennessee by the end of the year and reaching 400 MW by 2026.
CLSK shares have delivered a year-to-date (YTD) return of over 45%. Despite trading at a premium valuation of 9.2 times salesanalysts remain bullish, expecting a 65% gain with a Median 12-month target of $26.50.
iShares Blockchain & Technology ETF (IBLC)
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Investing in blockchain stocks can mean potential long-term returns. As a result, a blockchain ETF can offer diversification, simplicity, and exposure to innovative technologies, making it an attractive choice.
Next up on today’s list of blockchain stocks is iShares Blockchain ETFs and Technology (NYSE:IBLC). Launched in April 2022, IBLC tracks the NYSE FactSet Global Blockchain Technologies Indexinvesting primarily in companies that promote blockchain and cryptographic technologies worldwide.
With net assets of over $23.5 million, this is still a small fund. IBLC allocates 77% to information technology and 22% to finance, with holdings in 35 stocks. Since the ETF is weighted by market cap, the top 10 holdings account for over two-thirds of the fund. Top names include Marathon Digital Participations (NASDAQ:MARA), CleanSpark, Coinbase Global (NASDAQ:CURRENCY), Hut 8 (NASDAQ:HUT), AND Terrawulfo (NASDAQ:Fox). Geographically, the United States leads the way with nearly 82%, followed by Canada, Australia, and China.
So far in 2024, IBLC has gained 15%, complemented by a 1.2% dividend yield. Shares are currently trading at 22.4 times trailing earnings and 3.5 times book value. We should remind readers of the 0.47% expense ratio if they are looking to gain exposure to blockchain stocks via this ETF.
Mastercard (MA)
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As we conclude our discussion on blockchain stocks, MasterCard (London share:BUT) emerges as a global payments leader advancing distributed ledger technology. The company made the Forbes 2023 list Blockchain List 50which showcases companies that are investing heavily in blockchain.
In May, Mastercard reported a solid first quarter 2024 results. Net revenue reached $6.3 billion, up 11% year over year on a currency-neutral basis. Adjusted diluted EPS increased to $3.31 from $2.80 in the prior-year quarter. Operating margin was 56.8% compared to 54.6% in the prior-year quarter.
Mastercard focuses on digital payments, especially contactless and tokenized transactions. The company aims to fully implement Tokenization of e-commerce in Europe by 2030, improving the security and accessibility of transactions. In addition, Mastercard has in partnership with blockchain technology companies and established a Crypto Card Program to launch cryptocurrency-funded payment cards.
Wall Street notes that Mastercard is also leveraging investments in blockchain and artificial intelligence (AI) to innovate its processing capabilities. In particular, the company employs Generative AI to detect fraudachieving double the speed in identifying compromised cards compared to previous methods.
Since January, MA stock has gained about 5% YTD as shares trade at 30.5 times forward earnings and 16.5 times sales. Finally, analysts have set a 12-month average price forecast of $514.07 for Mastercard shares, with a potential upside of 14%.
As of publication date, Tezcan Gecgil had no (directly or indirectly) positions in the securities mentioned in this article. The views expressed in this article are those of the author, subject to InvestorPlace.com Publishing Guidelines.
Tezcan Gecgil, PhD, began contributing to InvestorPlace in 2018. He brings over 20 years of experience in the US and UK and has also completed all 3 levels of the Chartered Market Technician (CMT) exam. Publicly, he has contributed to investments.com and the UK website of The Multicolored Fool.