So you’re saying there’s a chance? Marathon Digital (NASDAQ:MARA) stock jumped in after-hours trading on news that the company, which has been the object of mergers and acquisitions rumors, is not for sale. This was the message from MARA stock CEO Fred Thiel.  

However, Thiel did not say it was out of the question for the future, and that may have been wise. Because later in the interview, Thiel acknowledged that he would bring any offer at the right price to the board of directors. And that means the rumors may not completely die. 

Speaking at the Bitcoin 2022 Conference in Miami, Thiel remarked that MARA stock is significantly undervalued compared to where it was at the end of 2021. He may be right. MARA stock is down nearly 74% from its 52-week high.

However, Bitcoin (CCC:BTC-USD) is down about 42% from its all-time high. If Bitcoin begins to recover in price, it’s reasonable to believe Marathon Digital will ride on its coattails. 

One reason why Thiel may be correct in his assessment of MARA stock is its anticipated increase in mining capacity. It’s been taking the company longer than expected to deploy its miners. That situation seems to be improving. The company reported mining capacity of 3.9 EH/s in March. However, that number is expected to rise to 23.3 EH/s by the first part of 2023.  

That’s certainly the expectation of analysts who are giving MARA stock a consensus price target of $57.80. That’s a gain of more than 166% from the current price. No analyst has weighed in since Thiel’s announcement that Marathon is not expecting to be acquired. However, investors will want to pay close attention to that as the company reports earnings in May.  

MARA stock has given up nearly all of its pre-market gains as of this writing. That may be a reflection of the continued pressure that Bitcoin and other cryptocurrencies are facing. With no firm indication the crypto winter is over, investors should be very careful when considering a position in MARA stock. 

On the date of publication, Chris Markoch did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.