To The Moon

$Marathon Digital Holdings Inc(MARA)$ is expected to release its Q3 earnings on 08 Nov 2023 after the market closes (AMC). Market expect MARA to post a loss of $0.11 earning per share in this upcoming earnings report. MARA last reported earnings on 08 August after the market close (AMC). MARA shares declined -1.3% the day following the earnings announcement to close at 15.51. After its Q2 earnings release, 91 days ago, MARA stock has drifted -40.8% lower. Since the last Q2 announced earnings, MARA traded in a range between 7.16 and 16.03. The last price (9.18) is closer to the lower end of range. Marathon Digital (MARA) EPS and Revenue Past 2 Quarters We have seen whether there is EPS or revenue surprise, MARA seem to trade downside post earnings. MARA have a very close correlation with Bitcoin and its share price might be influenced by any changes in Bitcoin price movement as well. MARA has announced its expansion projects and what I would be interested to find out from this Q3 earnings is how MARA revenue would be performed given that Bitcoin prices was rather volatile during Q3. And there is the high interest rate which might cause MARA’s operating cost to increase. With more expansions overseas, MARA might need to deal with exchange rate risk as well. Marathon Digital (MARA) Historical Moves Ahead of Earnings MARA historically moved higher heading into earnings more often than not. On average, the stock gained 4.6% for the 2 week period before earnings (based on the last 12 quarters of data). Marathon Digital (MARA) Historical Stock Price Reaction to Earnings MARA shares have moved lower in the immediate aftermath of earnings 10 out of 12 previous reports. On average the stock moved down -4.9% in the first day of trading after the company reported earnings. Marathon Digital (MARA) Stock Behavior After Earnings Based on the previous 12 earnings releases, MARA is more likely to trade higher 1 day after earnings for an average gain of 1.0% Marathon Digital (MARA) Post Earnings Announcement Drift MARA share price has drifted down -40.8% post earnings announcement. Using the last 12 quarters data, the average drift between earnings announcements is 151.7%. The current drift represents a negative -0.1 standard deviation move. Current post earnings announcement drift: -40.8% Historical average post earnings announcement drift: 151.7% Historical post earnings drift standard deviation move: ±513.8% Marathon Digital (MARA) Post Earnings Movement Options market overestimated MARA stocks earnings move 75% of the time in the last 12 quarters. The predicted move after earnings announcement was ±12.1% on average vs an average of the actual earnings moves of 6.6% (in absolute terms). MARA Earnings Implied Volatility Crush MARA's last earnings implied volatility (IV30) going into earnings was 99.3. The last time MARA released earnings, the implied volatility dropped to 96.8, resulting in an implied volatility crush of 3%. 5 days after earnings, the 30 day IV was 88.2. Average Implied Volatility Crush For MARA Earnings: 0% Average 30 Day Implied Volatility 1 Day Before Earnings: 138.6 Average MARA 30 Day IV for the Day of Earnings: 137.8 Average 30 Day Implied Volatility 5 Days After Earnings: 135.5 Summary Based on what I have gathered it looks like MARA might experienced a mixed price movement after its earnings announcement. The past have shown that despite EPS and Revenue surprise, price still moved downwards in the recent last 2 quarter. I think what is important, we need to understand the correlation of MARA to Bitcoin. MARA seem to have moved favorably when Bitcoin is trading upside. Currently, Bitcoin is trading above $35,000 at the time of this writing, and it is currently trading in a zig-zag price movement. A surge of price later might help MARA to gain. I will be watching the price movement of MARA and see if there is any unusual trading volume. I am also looking at the Option strategy I can deploy to take advantage of this mixed price movement potential. Appreciate if you could share your thoughts in the comment section whether you think MARA price will surge after EPS and Revenue beat estimate but Bitcoin hover around $34-35 thousands? @TigerStars @Daily_Discussion @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts. Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.