Riot Blockchain stock forecast as BTC production increases by 433% in October

On Wednesday, Riot Blockchain Inc. (NASDAQ:RIOT) shares edged lower 2% despite reporting a significant rise in bitcoin production in October. The company said its BTC production increased by 433% from the same month last year to 464 pushing its total produce to 3,395.

The company has a hash rate capacity of 2.8 exahash per second from a fleet of about 27,270 miners. Ir recently purchased 9K S19j Pro miners from Bitmain Technologies for $54 million as it targets to have about 90,150 Antminers in operation by Q4 2022.

It now targets hash rate capacity to reach 8.6 exahash in 2022, up 11.7% from the previous estimate of 7.7 exahash.

Time to bet on growth?

From an investment perspective, Riot Blockchain shares trade at steep trailing 12-month P/E and forward P/E ratios of 95.51 and 17.84, respectively. Therefore, value investors could opt for alternatives in the market.

However, analysts expect its earnings per share to grow by 70.50% this year before rising further by 81.89% next year. Therefore, the stock could gain the attention of growth investors.

Technically, Riot Blockchain shares seem to be trading within a gently ascending channel formation in the intraday chart. As a result, the stock has surged to find the trendline resistance next to the 100-day moving average.

However, with shares yet to reach overbought conditions, the current rally could continue. Therefore, investors could target extended gains at about $36.65, or higher at $42.23. On the other hand, $26.12 and $20.96 are crucial support zones.

It could be time to take some profits

In summary, although Riot Blockchain shares are yet to reach overbought conditions after the recent rebound, the stock seems to be facing significant resistance from the 100-day moving average. 

Therefore, given the company’s steep valuation multiples, it could be a perfect time to take some profits before buying again when the stock hits the key support to capitalise on growth prospects.