Analysts’ prediction leads to a 23% surge in Price.
Riot’s shares experienced a remarkable surge of more than 20% due to the positive evaluations provided by analysts who foresee substantial growth in the company’s financial performance.
The anticipation surrounding Riot’s financial performance, specifically in light of recent predictions made by analysts, has generated significant interest among investors. This optimistic sentiment was evident as Riot Platform’s stock (RIOT) on Nasdaq witnessed a surge of 23% to reach $11.24 as of April 23, according to data from Google Finance.
On April 22, Analyst Mike Colonnese from H.C. Wainwright reaffirmed a Buy rating on Riot Platforms and set a target price of $20.00. He emphasized the company’s clear growth trajectory and strong financial position as the primary factors driving his positive outlook.
Colonnese highlighted Riot’s plans to substantially enhance its hash rate, increasing it from 12.4 EH/s to 31.5 EH/s by the end of 2024 and further to 41 EH/s by the end of 2025. This strategic capacity expansion is supported by the operational commencement of the first 400 MW substation at the new Corsicana facility in Texas.
Moreover, the company’s financial strength is underscored by its liquidity of over $1.2 billion, positioning it well for future expansions.
Colonnese identified Riot’s current low-cost production strategy and the underperformance of its stock year-to-date as an attractive investment opportunity. He also mentioned the reduced shipment times for necessary mining rigs due to the manufacturing presence of MicroBT in Pennsylvania, which supports Riot’s near-term expansion strategies.
While Colonnese acknowledges some past challenges in deployment timelines, he remains confident in Riot’s ability to effectively execute its expansion plans.
Separately, on the same day, Roth MKM analyst Darren Aftahi expressed a similarly optimistic stance on Riot Platforms following his attendance at the company’s Analyst Day in New York.
Aftahi maintained a Buy rating with a price target of $25.50, expecting the company to achieve an EBITDA of $54.7 million on revenue of $391.5 million in fiscal 2024, with further improvements to $144.5 million EBITDA on $516.4 million revenue in fiscal 2025.
The analyst’s optimism stems from Riot’s strong financial structure, highlighted by approximately $1.3 billion in cash and Bitcoin holdings as of the end of March.
“Following the halving, we believe RIOT is one of a few miners that has a line of sight to a significantly higher hash rate in the next 6-12 months,” he wrote.
Additionally, according to the analyst, the partial energization of Corsicana’s first building is a key factor that could drive significant growth in Riot’s hash rate and, consequently, its stock valuation in the near term.
