On Thursday, H.C. Wainwright updated its outlook on shares of Hive Digital Technologies (NASDAQ:HIVE), increasing the price target to $8 from $5, while maintaining a Buy rating on the company's stock.
The revision follows Hive's announcement of mixed financial results for the second quarter of fiscal year 2025, along with details on its bitcoin mining expansion and reaffirmation of its High-Performance Computing (HPC)/Artificial Intelligence (AI) revenue guidance for the end of calendar year 2025.
Hive Digital disclosed two significant developments in its self-mining operations after the quarter ended. Firstly, the company purchased 6,500 Canaan Avalon A1556 miners, enhancing its mining capacity by 1.2 EH/s.
Secondly, Hive began construction on a new 100 MW datacenter in Paraguay. These miners will replace the older, less efficient models in Hive's fleet and are expected to boost the company's operational hash rate to 6.0 EH/s with improved fleet efficiency by the first quarter of calendar year 2025.
The new Paraguayan datacenter is projected to have 30 MW and 2 EH/s operational by the second quarter of calendar year 2025, which will further increase Hive's total capacity to 8 EH/s. The company aims to reach a hash rate of 12.5 EH/s with 17.6 J/TH of efficiency by the third quarter of calendar year 2025, following the site's completion and full power-up by the summer of that year.
On the HPC front, Hive's management has delayed its $20M annualized HPC run rate revenue target to the first quarter of calendar year 2025, which was previously set for the fourth quarter of 2024.
Nevertheless, the firm has reiterated its end goal of achieving $100M in annualized revenues from this segment by the end of calendar year 2025. This guidance supports the analyst's decision to reaffirm the Buy rating and raise the price target for Hive Digital Technologies.
In other recent news, Hive Digital Technologies has been the focus of significant developments. Cantor Fitzgerald initiated coverage on the company's shares with an Overweight rating and a 12-month price target of $9.00, highlighting Hive's status as a top ten Bitcoin miner and its potential to more than double its hash rate in the next year.
The firm also acknowledged HIVE's ventures into artificial intelligence and high-performance computing (AI/HPC), with plans to expand its GPU fleet, targeting an annual recurring revenue of $100 million by 2025.
In line with these growth targets, Hive Digital announced plans to convert 30 megawatts (MW) of existing capacity from Bitcoin mining to Tier 3 data centers. The company is also developing a new 100 MW site in Paraguay, projected to be fully operational by the third quarter of 2025.
These developments are central to Hive Digital's aggressive growth targets and the positive outlook from both Cantor Fitzgerald and H.C. Wainwright.
InvestingPro Insights
Recent data from InvestingPro sheds additional light on Hive Digital Technologies' financial position and market performance. The company's market capitalization stands at $595 million, reflecting its position in the cryptocurrency mining sector. Despite the mixed financial results reported in Q2 FY2025, Hive has shown impressive price performance, with a 101.29% total return over the past six months and a 63.86% return over the last year.
InvestingPro Tips highlight that Hive operates with a moderate level of debt and its liquid assets exceed short-term obligations, which could support its ambitious expansion plans in bitcoin mining and HPC/AI operations. However, it's worth noting that the company is not currently profitable over the last twelve months, aligning with the analyst's focus on future growth potential rather than immediate profitability.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for Hive Digital Technologies, providing a deeper understanding of the company's financial health and market position.
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