Iris Energy Poised to Emerge as Top Bitcoin Miner, Says Canaccord
Iris Energy (IREN) is set to emerge as one of the most efficient and prominent publicly traded bitcoin miners, with a focus on high-performance computing (HPC) as it commences its trial in Childress, Texas in the latter part of this year, according to brokerage firm Canaccord’s recent research report.
As the Sydney-headquartered company expands its operations, the report highlights that there are very few bitcoin miners with equivalent power capabilities at their disposal. Canaccord also raised its price target for Iris Energy’s shares from $12 to $15, while maintaining a buy rating. In early trading on Wednesday, Iris Energy’s stock was up 1.6% at $11.06 on Nasdaq.
Analysts, led by Joseph Vafi, noted that the company is constructing 510 megawatts (MW) of data centers by 2024, has secured 2,160 MW of power capacity, and boasts a development pipeline exceeding 1 gigawatt (GW). This strategic positioning underscores Iris Energy’s commitment to growth and innovation within the sector.
Recent market activity has seen a shift in mining stocks following Core Scientific’s (CORZ) AI deal with CoreWeave, indicating a growing interest in alternative and potentially more lucrative applications for bitcoin mining sites in AI and HPC, as highlighted in a report by JPMorgan.
Iris Energy faced a setback earlier this month when its shares dropped by 14% subsequent to a short seller’s claim that the Childress site was unsuitable for hosting AI or HPC activities. Despite this, the stock remains below its pre-slump levels of nearly $14.
Given Iris Energy’s primary focus on infrastructure development, Canaccord believes that the company is well-positioned to diversify the use cases of its data centers beyond bitcoin mining. Management is expected to leverage opportunities in power, cooling, and networking to explore additional revenue streams such as AI cloud services and AI colocation.
The brokerage firm also emphasized the value proposition of bitcoin mining for Iris Energy, noting that it not only generates revenue but also contributes to funding infrastructure expansions. The report highlighted various avenues through which the company can monetize its infrastructure, including through bitcoin mining, AI cloud services, and AI colocation.
In conclusion, Iris Energy’s strategic approach to expanding its operations and exploring new revenue streams beyond traditional bitcoin mining underscores its adaptability and potential for sustained growth in the evolving cryptocurrency landscape.
