Analyst reaffirms Buy rating and 4 price target for Bitfarms shares
HC Wainwright has restated its positive outlook on Bitfarms (NASDAQ:BIT) stock, giving it a buy rating with a target price of $4.
Analyst Mike Colonnese from HC Wainwright believes that Bitfarms is currently one of the most undervalued stocks in the Bitcoin mining industry. The company’s willingness to consider a sale if it benefits shareholders indicates that any successful bid could result in a substantial premium compared to the current trading price of BITF.
Colonnese, who recently started covering Bitfarms stock, released a bullish forecast for the company in a research note on Monday, June 17.
In a recent development, Bitfarms entered into a $3.7 million all-stock agreement for 120 MW of power, showcasing the company’s strong growth strategies. Following this announcement, Bitfarms shares surged by 15%. The agreement will bring 0.6 EH/s of power online in the fourth quarter of 2024 and a total of 8 EH/s in the second half of 2025.
An additional 6 EH/s will be added in 2025 through a new 100 MW expansion at Yguazu. Bitfarms expects to reach a capacity of 21 EH/s by the end of 2024 and aims for 35 EH/s by the end of 2025.
The analyst estimates that Bitfarms is set to enhance its total power capacity by 170% to 648 MW in 2025, up from the current 240 MW. This growth is supported by the new site in Sharon, PA, which is expected to contribute to an increase in owned and operated infrastructure to around 650 MW by 2025.
Despite recent market fluctuations and the Riot takeover situation, BITF stock has seen a 30% increase in June and a nearly 24% rise in the past five days. Year-to-date, BITF is up by 5.7%.
However, HC Wainwright cautions that there are potential risks to achieving the $4 price target for BITF. These risks include volatility in Bitcoin prices, delays in the development of Bitfarms’ new mining facilities, and the possibility of shareholder dilution from equity capital raises.
