Millennials, GenX, and Boomers that missed the meteoric rise in Bitcoin no longer need the play the “woulda coulda” game. A NASDAQ-listed company is providing a second chance to invest in Bitcoin at rock bottom prices. But not through owning the actual token. This time, the opportunity is through LM Funding America, Inc (NASDAQ: LMFA) and its wholly-owned U.S. Digital Hosting and Mining Co., LLC.
Okay, there’s a catch. You need to purchase LMFA stock. But, don’t worry, it’s an attractive trade that takes advantage of their ability to own Bitcoin at a 95% discount from current prices. And that discount price is considering this morning’s price of $36,156. If Bitcoin goes higher, the cost of ownership gets even lower. That begs the question- why is LMFA trading at only $5.28 and holding a market cap of about $67 million?
Easy answer. Because LMFA, the digital gold miner, is way under the radar. But only in that respect. Investors already in the stock are doing well from LMFA’s other interests. They are up more than 33% since the end of September, following the company posting net income of $15.5 million or $2.96 per basic and $2.95 per diluted share in the first half of the year. Thus, by no means should investors think LMFA is pitching up clickbait BTC headlines. This company is real, makes a lot of money, and is on the precipice of earning a whole lot more.
Putting Antminers To Work
The better news…this isn’t a long-term play for returns. Its Bitcoin mining initiative is well underway. In fact, they recently ponied up more than $31 million to purchase the best Bitcoin mining machines available, the S19J Pro Antminer Machines. That brings its total ownership to 5000 miners. What’s that mean to investors at current levels? Simply put- a potentially exponential increase in shareholder value.
Remember, Bitcoin is hovering around the $36,000 level and only costs LMFA about $5,000 to generate a single Bitcoin. That’s an excellent return. However, when 5000 of the Antminers are put to work, don’t expect a single coin. Expect at least 1200 bitcoins per year. The result- LMFA can turn “digital gold” into millions of U.S. dollars. Better yet, the roughly $6 million in cost necessary to mine 1200 coins at current prices would create more than $68 million for LMFA. Keep in mind, too, that $6 million is an all-in cost on the production side. And labor shortages and filling three shifts a day aren’t required. These machines work 24/7/365, and other than a tune-up and regular maintenance, they don’t get benefits.
Here’s another bonus. While inflation fears send the markets on a roller coaster ride, it can be music to the ears of BTC (digital gold) holders. And make no mistake, inflation is here. It’s also a reason why the largest financial institutions are calling for Bitcoin to reach upwards of $130,000 as early as Q1 of 2022. If so, forget about LMFA holding about $68 million of Bitcoin- they would be banking about $156 million. By the way, the cost of goods remains the same. Thus, LMFA can be more than a digital cash cow; they can become a printing press of real dollars when they sell holdings.
This Company Is In Play
Seem too good to be true? It’s not. Investors simply aren’t aware that LMFA is entering the space with such vigor. But the window of opportunity is closing. As noted, news of LMFA’a Antminer purchases is attracting attention. Moreover, they made clear in a press release last quarter that are not intending to slow down.
Not only is LMFA expediting an ambitious plan, but they are also using state-of-the-art equipment. Better still, they employ “green” technology that isn’t short on power. Specifically, its Bitmain S19J Pro Antminer Machines are high efficiency, high hash rate machine mining SHA-256 algorithm that generates a maximum hash rate of 100 TH/s and has a power consumption of 3,000 KW/h. It’s technical language, but here’s what investors should focus on- LMFA expects to have all 5000 machines delivered and on-site generating Bitcoin by the second quarter of next year. And as noted, with approximately 504 petahash, investors can expect LMFA to generate about 100 Bitcoin per month based on current difficulty rates.
Keep in mind, too, milestones reached along the way will likely become catalysts for share price appreciation. Thus, launching 2000, 3000, 4000, and then 5000 Antminers each should drive share prices higher. Moreover, gains would be well deserved with downside risk mitigated by a strengthening BTC price. Best of all, LMFA is mining the right way, keeping the cancel culture a potential ally. That matters.
Mining Digital Gold With Green Technology
For those paying attention to Elon Musk raising awareness about high-carbon energy consumption needed to mine Bitcoin, don’t be concerned. Instead, embrace his vision because LMFA has that part covered as well.
LMFA announced that it has contracted with Miami-based Bit5ive subsidiary Uptime Armory LLC to manufacture 18 Pod5ive specialty containers and with Uptime Hosting LLC to house LMFA’s mining machines. The 1-megawatt POD5ive idea was born as a turnkey mining solution offering greater density with a smaller footprint and lower cost factor. Even better, its design is more than an effective crypto mining solution; it requires minimal setup and seamless installation. Hence, LMFA can get up and running almost immediately after machines are delivered. Better still, they can create shareholder value. And that’s the immediate plan.
Remember, Riot Blockchain (NASDAQ: RIOT) and Sphere 3D (NASDAQ: ANY) have had their 900%, and 835% runs, respectively. And while legacy issues took back a good portion of their gains, for LMFA, it’s their turn to shine. The precedent set by peer companies suggests they can do very well. Moreover, LMFA looks exceptionally better-positioned balance sheet wise to hold gains.
Speaking of gains, how big could they be? Well, assuming that LMFA delivers only the 1200 Bitcoin expected and prices of Bitcoin hold at $36,000, a $17 share price is justified using similar peer revenue multiples. However, if Bitcoin moves higher per the bullish models, upwards of $50 is in play. Indeed, having less than 13 million shares O/S and only about 9.5 million in the float has advantages. Better yet, the total package at LMFA offers much more than an impressive capital structure. They have excellent management, cash, the right equipment, and target a market where the bull’s pace is going from a trot to a stampede.
Missed The 57,000% Run, Don’t Look Past 400%
Bottom line- LMFA may have a coming-out party sooner than later. Better still, expect the party favors they show off, namely 5000 state-of-the-art Antminers, to generate enough industry buzz to send share prices significantly higher.
So, to those that missed the exponential rise in BTC, here’s a second chance. It may not deliver the 57,000% return had you purchased BTC at $100, but if all goes according to plan, gains between 400% – 800% in the near term are certainly not out of line with industry valuations.
Indeed, the digital currency train has left the station. LMFA is providing an excellent opportunity to get on board. Consider buying the ticket.
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