Rothschild Redburn Starts Hut 8 Mining Corp. (HUT) at Neutral
Rothschild Redburn analyst Alex Haissl initiates coverage on Hut 8 Mining Corp. (NASDAQ: HUT) with a Neutral rating and a price target of $96.00.
The analyst comments: “Hut 8’s original operating entity, Hut 8 Mining Corp., is a Canadian company founded in 2011, while the current listed parent, Hut 8 Corp., was formed in 2020. The company started as one of North America’s largest publicly traded Bitcoin mining operations, building out large-scale, low-cost data centre capacity in Alberta and other parts of Canada to run Bitcoin ASIC miners. In late 2023, Hut 8 Mining merged with US Bitcoin Corp in an all-stock combination, forming the present-day Hut 8 Corp. and consolidating a broader set of energy and data centre infrastructure assets. Alongside its continuing Bitcoin mining business, the combined company has pivoted toward diversified digital infrastructure, developing power and data centre capacity for high-performance computing and AI workloads (including through its managed-services and power-infrastructure arms) to capture demand beyond crypto mining.
We launch on Hut 8 with a Neutral, as unit economics and pipeline conversion risks are well priced in. We value Hut 8 with a DCF-based approach, with a 25% cost of equity and 6% cost of debt. Key upside risks to our valuation and rating include better-than-expected execution on getting data centres online and securing more grid capacity. Key downside risks include delays or cancellations in the buildout.”
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Shares of Hut 8 Mining Corp. closed at $98.74 yesterday.