The big decline in price over the last few months for Marathon Digital Holdingsmay encourage investors to take a closer look at the firm as it is trading at a share price of 6.91 on 21,853,126 in trading volume. The company directors and management failed to add value to investors and position the firm supply of money to exploit market volatility in November. However, diversifying your holdings with Marathon Digital or similar stocks can still protect your portfolios during high-volatility market scenarios. The stock standard deviation of daily returns for 90 days investing horizon is currently 6.97. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the Marathon Digital Holdings partners.
Will Marathon Digital (USA Stocks:MARA) debt increase in January
 | By Rifka Kats | Macroaxis Story |
The stock is undergoing above-average trading activities. While some baby boomers are getting worried about it services space, it is reasonable to go over Marathon Digital Holdings as an investment alternative. Let's analyze the possibilities of Marathon Digital maintaining its debt level in January.
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Reviewed by Michael Smolkin
Marathon Digital Holdings currently holds 728.41 M in liabilities with Debt to Equity (D/E) ratio of 1.16, which is about average as compared to similar companies. The entity has a current ratio of 3.94, suggesting that it is liquid enough and is able to pay its financial obligations when due. Debt can assist Marathon Digital until it has trouble settling it off, either with new capital or with free cash flow. So, Marathon Digital's shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Marathon Digital Holdings sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Marathon to invest in growth at high rates of return. When we think about Marathon Digital's use of debt, we should always consider it together with cash and equity.Marathon Digital financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Marathon Digital, including all of Marathon Digital's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Marathon Digital assets, the company is considered highly leveraged. Understanding the composition and structure of overall Marathon Digital debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.
Understanding Marathon Total Debt
Marathon Digital Holdings liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Marathon Digital Holdings has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on Marathon Digital balance sheet include debt obligations and money owed to different Marathon Digital vendors, workers, and loan providers. Below is the chart of Marathon main long-term debt accounts currently reported on its balance sheet. You can use Marathon Digital Holdings financial leverage analysis tool to get a better grip on understanding its financial positionHow important is Marathon Digital's Liquidity
Marathon Digital financial leverage refers to using borrowed capital as a funding source to finance Marathon Digital Holdings ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Marathon Digital financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Marathon Digital's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Marathon Digital's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Marathon Digital's total debt and its cash.
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