Investment Firm Bernstein Rates Bitcoin Mining Stocks ‘Outperform’

Cryptonews John Brightwater August 16, 2024

Investment Firm Bernstein Rates Bitcoin Mining Stocks ‘Outperform’

Investment firm Bernstein has recently issued an ‘outperform’ rating for Bitcoin (BTC) mining stocks Riot Platforms (RIOT), CleanSpark (CLSK), Iris Energy (IREN), and Core Scientific (CORZ), while Marathon Digital Holdings (MARA) received a market-perform rating.

Riot Platforms (RIOT) was lauded for its substantial operational power capacity and expansion plans, particularly its upcoming 1GW site in Corsicana, Texas and its recent acquisition of Block Mining with 60 operational MW, extendable to 300MW. Additionally, analysts noted an increase in production efficiency in July following the replacement of older S19 XP mining rigs with the latest generation models, with expectations for the company to surpass 36 EH/s of hash rate by the end of 2024.

CleanSpark (CLSK) was praised for its energy efficiency and realized hash rate, positioning it as one of the top three Bitcoin producers alongside Marathon and Core due to its focus on operational efficiency and higher uptime.

Iris Energy (IREN) received positive feedback for its ambitious expansion plans and potential in the AI sector, with expectations to exceed 30 EH/s by Q4 2024 driven by its 750 MW site at Childress, Texas and its engagement of Morgan Stanley to explore AI deals for its mega sites.

Core Scientific (CORZ) was recognized for its cost efficiency and leading AI strategy, earning a “best in class” hash cost driven by low power cost, uptime, and controlled SG&A costs. The firm’s diversification into AI services differentiates it from competitors focused solely on Bitcoin mining.

Marathon Digital Holdings (MARA) was evaluated as market-perform, with recognition of its strengths as “the largest on self-mining and co-hosting scale,” but also seen as an “improving story” pending its transition to self-owned sites to reduce its reliance on hosting partners.

Analysts anticipate mining margins to improve in the fourth quarter of 2024, driven by a re-energized Bitcoin bull cycle led by fresh institutional ETF flows, and expect mining costs to improve as miners deploy the latest generation rigs at scale for new expansion, leading to operating leverage.

In summary, Bernstein’s outperform rating on Bitcoin mining stocks reflects a positive outlook on the industry and highlights the potential for growth and efficiency among the companies mentioned. Their in-depth analysis of the strengths and potential areas for improvement of each company provides valuable insight for investors considering entry into the Bitcoin mining sector.