In a recent research report, brokerage firm Canaccord highlighted Iris Energy (IREN) as poised to emerge as one of the most efficient and largest publicly listed bitcoin miners. The Sydney-based company is set to commence operations in Childress, Texas, in the latter half of this year, tapping into high-performance computing (HPC) capabilities alongside its bitcoin mining initiatives.
Canaccord’s analysts, led by Joseph Vafi, noted that Iris Energy stands out due to its substantial power capacity. The company plans to build 510 megawatts (MW) of data centers in 2024, with secured power capacity of 2,160 MW and a development pipeline exceeding 1 gigawatt (GW).
The brokerage firm raised its price target for Iris Energy from $12 to $15, affirming a buy rating. Currently, Iris Energy shares were trading 1.6% higher at $11.06 on Nasdaq during early Wednesday trading.
The report highlighted a recent rerating of mining stocks, spurred by developments such as Core Scientific’s (CORZ) AI partnership with CoreWeave. This indicates a growing market sentiment towards alternative and potentially more lucrative applications of bitcoin mining infrastructure, such as AI and HPC, as observed by JPMorgan.
Despite a recent 14% decline in Iris Energy’s shares following concerns raised by a short seller regarding the suitability of the Childress site for AI and HPC hosting, Canaccord remains optimistic. Emphasizing Iris Energy’s infrastructure-focused approach, the report suggested that management could capitalize on diverse revenue streams beyond bitcoin mining, leveraging its robust capabilities in power, cooling, and networking.
Canaccord reiterated that bitcoin mining remains a core value proposition for Iris Energy, crucial for funding its infrastructure expansions. The company’s strategic options include monetizing its infrastructure through bitcoin mining, AI cloud services, and AI colocation, indicating a multifaceted growth strategy.
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