According to investment banking firm Benchmark, the expansion of Hut 8’s self-mining operations and its diversified revenue streams will increase its competitiveness in the post-halving world of Bitcoin (BTC) mining. Benchmark senior analyst Mark Palmer stated in a research note that Hut 8, formed through a merger between the old Hut 8 and US Bitcoin Corporation, has a diversified business model with multiple sources of revenue. Benchmark has initiated coverage of Hut 8 stock and set a price target of $12, representing a nearly 30% increase from its current share price of $9.22. Although Hut 8’s self-mining hash rate is currently lower than that of Marathon Digital, the leader in the self-mining category, Palmer expects the gap to close over time. Palmer points to Hut 8’s various revenue streams, including self-mining, cloud computing, high-performance computing, and artificial intelligence services, as justification for the price target. Furthermore, Hut 8’s enterprise value-to-revenue multiple is slightly below the average of its publicly traded Bitcoin mining peers. Although Hut 8 needs to upgrade its hash rate, it holds a significant amount of Bitcoin reserves, providing liquidity and the potential to benefit from significant BTC price increases. In February, Hut 8 underwent a leadership shakeup and refuted claims made by a short-selling firm that it was in legal trouble.
Benchmark finds Hut 8's 'self-mining strategies' position it as a strong competitor after halving.