Is CryptoStar (TSXV:CSTR) Stock A Buy?

2 min read | May 19, 2021 08:45 AM PDT | By Anuj

Is CryptoStar (TSXV:CSTR) Stock A Buy? — Image source: DedMityay, Shutterstock

CryptoStar Corp (TSXV:CSTR)

CryptoStar Corp has crypto data centers across Canada, the US and Iceland, particularly for reasonable electricity and colder climate to generate new blocks. It mines digital currencies using its data facilities, which are blockchain-powered.

The junior fintech stock soared by about 100 per cent this year, led by its evolving mining operations. It also returned some 200 per cent in the past year on the back of the cryptocurrency market boom.

However, CryptoStar stock has gone through a massive correction and dropped to C$ 0.24 apiece against a record high of C$ 0.84 apiece (February 22, 2021).

The crypto company booked unprecedented profits in the first quarter of 2021, led by the skyrocketing cryptocurrencies’ prices. The company held a total of 46.6 Ethers, 15.4 Bitcoins and C$ 22.5 million cash in hand in the latest quarter.

CryptoStar's One-Year Price Movement Against 20-Moving Average and Volume. (Source: EODHD/Others)

At the previous close price, CryptoStar stock was down 7.7 per cent from its 20-moving average. However, it is still up more than 69 per cent from the 200-day simple moving average (SMA), showing a long-term uptrend.

The company expects to expand its mining inventory by adding more GPU and ASIC units in June 2021. It will place additional orders for miners using capital management strategies as per the crypto market trajectory in the second half of 2021. CryptoStar has been importing crypto mining equipment from a Hong Kong-based vendor.

The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.

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