Wall Street Brokers Benchmark Said Hut8 (HUT) Has Changed From Bitcoin BTC$114,329.79 Miners have grown into broader energy infrastructure companies that can capitalize on the demand for artificial intelligence (AI) and high-performance computing (HPC).
Analyst Mark Palmer reiterated his buy rating on the stock and more than doubled his price target from $36 to $78 in a report on Tuesday. Palmer cited a sum-of-the-parts analysis based on the company's energy infrastructure pipeline, 64% stake in American Bitcoin Corporation (ABTC), and 10,264 BTC on its balance sheet as of June 30th.
Shares were down 0.7% at $38.57 in early trading.
Palmer described the stock as a “flexible call option” for the rise of AI, HPC, Bitcoin and future energy-intensive applications.
Under CEO Asher Genuto, who took over in February 2024, Hut8 is focused on controlling low-cost power infrastructure that can be deployed for its most profitable workloads, and is developing 1,530 megawatts (MW) of capacity, primarily for AI and HPC data centers, Palmer wrote.
The analyst said investors have rewarded Genuto's strategy, with the stock more than quadrupling in the past six months. Still, Hut8's intrinsic value still exceeds its market capitalization, he said.
Benchmark said short-term catalysts include a potential tenancy at Hut 8's Riverbend site in Louisiana, while longer-term growth could come from replicating the model at its Vega facility in Texas.
The broker also highlighted that the company's 1,255 MW of exclusive capacity and 6,815 MW of capacity under diligence were both excluded from the valuation, and said the current estimate of $6 million per MW for the project was about 50% below the peer average.
read more: Hut8 charts a “path to monetization” for energy assets as Bitcoin mining carve-out approaches: Benchmark
