On Monday, Cantor Fitzgerald initiated coverage on shares of Hut 8 Mining Corp. (NASDAQ:HUT) with an Overweight rating and a price target of $35.00. The firm sees Hut 8 as one of the more compelling Bitcoin mining companies in the public market, despite not being the largest in terms of mining capacity. The company's significant power capacity, which provides flexibility in operations, was highlighted as a key factor.
Hut 8's partnership with Bitmain, a private company, was recently announced, and it involves Hut 8 hosting 15 EH/s of Bitmain's new direct-to-chip liquid cooling machines at its new 205 MW facility in Texas, known as Vega. This collaboration is expected to generate at least $135 million in annual revenue starting in the second quarter of 2025.
Cantor Fitzgerald believes that Hut 8 will expand its operational capacity over the coming years, which will not only enhance its Bitcoin mining capabilities but also cater to AI and high-performance computing (HPC) use cases.
The company's Bitcoin holdings are also noteworthy, with a treasury balance of 9,122 Bitcoin, which contributes to its diversified business model.
According to Cantor Fitzgerald, this diversification provides Hut 8 with multiple opportunities to create shareholder value, ranging from potential Bitcoin value appreciation to capitalizing on the AI/HPC trend. This broad business approach is cited as a reason the shares are currently seen as attractive.
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