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Needham has reiterated its Buy rating on Bitdeer Technologies Group (NASDAQ: BTDR), maintaining a $14.00 price target.
The firm's analysis suggests that Bitdeer's Ohio locations, Massillon and Clarington, have significant potential for High-Performance Computing (HPC), with a combined capacity of approximately 800MW. This capacity positions Bitdeer favorably within the medium-term HPC pipeline among miners.
The firm anticipates a forthcoming site report from TLM that will assess Bitdeer's compatibility with HPC operations. The positive outlook on Bitdeer's HPC potential is tempered by adjustments to the company's revenue and EBITDA estimates for the coming years.
The revisions are due to expiring mining hosting contracts and a slower-than-expected increase in the self-mining hash rate, which will not sufficiently compensate for the contract losses.
Consequently, the firm has lowered its calendar year 2024 revenue estimates for Bitdeer from $426 million to $352 million and adjusted EBITDA forecasts from $100 million to $80 million. Additionally, there is a modest reduction in the 2025 adjusted EBITDA projection from $196 million to $186 million.
In other recent news, Bitdeer Technologies Group has been in the spotlight for its second-quarter earnings report for 2024, which showed a revenue of $99.2 million, falling short of the consensus estimate of $108.4 million.
Analyst firms such as Roth/MKM, Rosenblatt Securities, H.C. Wainwright, B.Riley, Cantor Fitzgerald, and Benchmark have adjusted their price targets and ratings for Bitdeer, reflecting their varying assessments of the company's financial health and future prospects.
Bitdeer has been actively expanding its operations, recently completing an offering of $172.5 million in convertible senior notes due 2029. The proceeds from this offering are intended for datacenter expansion and mining rig development.
Meanwhile, Bitdeer has been facing challenges in its Bitcoin mining operations due to higher network difficulty and operational disruptions, resulting in a decrease in Bitcoin mining in August 2024.
The company is also making headway in its diversification strategy, with upcoming results from TLM consultancy studies expected to provide insights into the viability of Bitdeer's sites for high-performance computing and artificial intelligence data center usage. These studies are anticipated to be a significant catalyst for Bitdeer's future direction and financial performance.
Furthermore, Bitdeer is scaling up its self-mining activities with the SEALMINER and has announced plans for an additional 1.6 gigawatts of expansion.
InvestingPro Insights
As Bitdeer Technologies Group (NASDAQ:BTDR) navigates the complexities of the mining and High-Performance Computing (HPC) sectors, the latest InvestingPro data reveals that the company holds a market cap of approximately $1.05 billion. Despite the positive outlook from Needham, Bitdeer's P/E ratio stands at a challenging -33.33, reflecting the market's concerns over its profitability. In the last twelve months up to Q2 2024, Bitdeer has seen a substantial revenue growth of 31.48%, underscoring its potential in the HPC market as noted by Needham.
InvestingPro Tips highlight that Bitdeer is quickly burning through cash, which could be a point of concern for investors looking at the company's cash management strategies. On the other hand, the company's liquid assets exceed its short-term obligations, suggesting a degree of financial flexibility in the near term. For investors seeking a deeper dive into Bitdeer's financial health and future prospects, InvestingPro offers additional tips, with a total of 9 more insights available that could help in making a more informed investment decision.
While Bitdeer does not pay a dividend, suggesting a reinvestment of profits back into the company, analysts predict that the company will become profitable this year, which could be a turning point for the firm's financial trajectory. The InvestingPro Fair Value estimate currently stands at $4.87, indicating a potential discrepancy with analyst targets, which investors may want to consider when evaluating the stock's future movements.
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