On Wednesday, BTIG adjusted its outlook on Core Scientific Inc. (NASDAQ: CORZ), raising its price target to $15.00 from the previous $10.00, while reiterating a Buy rating on the stock. The firm's positive stance comes after a series of analyst events and significant company announcements, including Core Scientific's recent contract wins in the data center space.
Core Scientific has been actively involved in industry events over the past two weeks, with its analysts attending presentations and meetings with several key players in the cryptocurrency mining sector. Notably, the company disclosed a 200MW high performance computing (HPC) contract with CoreWeave on June 3, 2024, and subsequently revealed additional data center contracts totaling 70MW.
These developments have led to a sharp increase in Core Scientific's stock price, which has surged approximately 90% in the weeks following the announcement of the CoreWeave contract. The firm has successfully shifted its focus to fixed-price, multi-year contracts, which has allowed it to partly decouple from the volatility of Bitcoin prices.
Since June 3, 2024, while Bitcoin has seen an approximate 11% decline, Core Scientific and other miners have experienced significant gains, with Terawulf and Iris seeing their stock prices soar by over 100% and approximately 70%, respectively.
In contrast, Bitcoin miners such as Riot Blockchain (NASDAQ:RIOT) Inc. and Marathon Digital (NASDAQ:MARA) Holdings Inc., which have not yet shifted their power usage toward HPC, have seen their stock prices fall marginally by 2-3% in the same timeframe. The industry-wide scramble for power access has been intensified by data center companies urgently seeking power solutions for their computing needs.
BTIG highlighted that the conversion of power to HPC has a notable impact on the global hash rate, with every 100MW of power transitioned to HPC potentially reducing the global hash by 5-6 EH. This shift underscores the strategic moves by companies like Core Scientific to capitalize on the growing demand for computing power in data centers.
InvestingPro Insights
As Core Scientific Inc. (NASDAQ: CORZ) garners a positive outlook from analysts, it's noteworthy to consider the performance and market sentiment around similar companies in the cryptocurrency mining sector. Marathon Digital Holdings Inc. (NASDAQ: MARA) presents an interesting comparison with its recent financial and market activity.
InvestingPro data reveals that Marathon Digital Holdings has a market capitalization of $5.25 billion, with a notable revenue growth of 328.1% in the last twelve months as of Q1 2024. This significant growth aligns with analyst anticipations of sales growth in the current year. Furthermore, the company's P/E ratio stands at 8.04, suggesting a potentially attractive valuation when compared to industry peers. However, the company's stock price has experienced considerable volatility, with a 28.6% decrease over the last six months, but it still maintains a strong return over the last year at 63.27%.
InvestingPro Tips for MARA indicate that the company is expected to be profitable this year, with analysts predicting positive performance. Additionally, the company's liquid assets surpass its short-term obligations, which may provide some financial stability in a volatile market. For readers interested in deeper analysis and additional insights, there are 11 more InvestingPro Tips available, which can offer a more comprehensive view of Marathon Digital Holdings Inc. and its potential investment opportunities. To explore these tips, visit InvestingPro and don't forget to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.