Benchmark: Maintains Buy Rating on Hut 8 with $85 Price Target

Odaily News Benchmark reiterated its Buy rating on Hut 8 and set a price target of $85, noting that management will focus on execution and delivery in 2026 to advance its AI data center strategy. This statement directly quotes CEO Asher Genoot from the company's Q4 earnings call. When discussing the flagship River Bend campus in Louisiana, Genoot said, "2026 will be 1000% focused on execution and delivery," adding that construction is "on schedule."

Analyst Mark Palmer pointed out in a report on Wednesday that while Q4 results were impacted by Bitcoin impairment losses, the more significant point is that Hut 8 is steadily transforming into an electricity-first digital infrastructure platform with a clearer path to long-term contracted cash flows. Hut 8 reported a net loss of $301.8 million for Q4, primarily due to $401.9 million in unrealized digital asset losses. Revenue nearly tripled year-over-year to $88.5 million, with a significant increase in compute business revenue. Palmer continues to believe that the core of the investment thesis is the 15-year, 245-megawatt River Bend IT lease signed with Fluidstack, which is financially backed by Google. The approximately $7 billion base period lease helps align Hut 8's valuation with infrastructure-like multiples.

Benchmark's $85 price target is based on what Palmer calls a "sum-of-the-parts" valuation model. This includes the River Bend lease, a probability-weighted valuation for up to 1,000 megawatts under a right of first refusal, the market value of Hut 8's 60% stake in American Bitcoin, and its Bitcoin holdings. As of Thursday morning, Hut 8's stock price was slightly below $55, down about 1.5% for the day. The stock remains below its recent high of around $66 but has surged over 300% in the past year, even as Bitcoin has declined by about 27% over the same period. (The Block)