Benchmark cuts Bitdeer stock target to $24, maintains Buy rating

On Wednesday, Benchmark analysts adjusted their outlook on Bitdeer Technologies Group (NASDAQ:BTDR) by reducing the price target to $24 from the previous $29, while still holding a Buy rating for the company’s shares. Despite the reduction, this target remains well above the current trading price of $9.26, with analyst targets ranging from $17 to $39. The revision follows Bitdeer’s recent announcement regarding its increased focus on developing bitcoin mining ASIC chips and rigs, which had a significant impact on the firm’s fourth-quarter operating results of 2024, with revenue declining 5.09% year-over-year.

Bitdeer’s management had previously informed the market of their strategic shift towards bitcoin mining technology, but the scale of this focus and its effect on the company’s performance was more substantial than investors had anticipated. As a result, Bitdeer’s stock price experienced a sharp drop, plunging over 28% during Wednesday’s trading session, contributing to a significant 37.94% decline over the past week. According to InvestingPro analysis, the stock’s RSI suggests it’s currently in oversold territory, though investors should note the company is quickly burning through cash. This downturn occurred amidst a wider decline in the cryptocurrency-related stock sector.

The analyst noted the unexpected intensity of Bitdeer’s commitment to its new product development and the consequent influence on the last quarter’s financial outcomes. Despite the reduction in the price target, the analyst’s continued endorsement of a Buy rating suggests a belief in Bitdeer’s long-term growth potential. InvestingPro data reveals 11 additional key insights about Bitdeer’s financial health and market position, available exclusively to subscribers.

The significant drop in Bitdeer’s share price reflects the immediate market reaction to the company’s operational shift and the broader industry trend. The company’s strategic decision to concentrate on ASIC chip and rig development is a move that Bitdeer expects to strengthen its position in the competitive bitcoin mining industry.

Investors and market watchers will likely continue to monitor Bitdeer’s progress on its strategic initiatives and their impact on the company’s financial health and stock performance in the coming quarters.

In other recent news, Bitdeer Technologies Group reported a significant decline in its fourth-quarter 2024 earnings, with revenue dropping to $69 million from $114.8 million year-over-year. The earnings per share (EPS) was reported at -$3.22, substantially missing the forecasted -$0.1604. The revenue shortfall and earnings miss were attributed to the April 2024 Bitcoin halving and reduced cloud hash rate. Despite these challenges, Bitdeer is focusing on the development of energy-efficient ASIC miners and aims to achieve a self-mining hash rate of 40 Exahash by the fourth quarter of 2025.

In addition to the earnings report, Bitdeer recently acquired a 101 MW gas-fired power plant in Alberta, Canada, expanding its total power capacity to over 2.6 GW. This acquisition is part of Bitdeer’s strategy to become a fully vertically integrated Bitcoin miner. Analyst Mike Colonnese from H.C. Wainwright revised the price target for Bitdeer to $21.00 from $22.00, maintaining a Buy rating on the stock despite the earnings miss. The analyst noted the company’s potential for growth with its innovative ASIC product roadmap and substantial energy assets. These developments reflect Bitdeer’s strategic focus on expanding its mining capabilities and enhancing energy efficiency.

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