JPMorgan Downgrades Bitcoin Miners’ Price Targets

JPMorgan has downgraded price targets for bitcoin miners in light of second-quarter results and company-specific announcements, such as improved fleet efficiency and hashrate targets.

The decrease in price targets is largely due to a downturn in bitcoin prices since the last model update, with the spot bitcoin price assumption reduced from $68,000 to $60,000, as outlined in an analyst report by the investment bank released on Friday.

Furthermore, the baseline network hashrate assumption has been revised upward from 600 exahash per second to 615 EH/s. These changes have contributed to a reduction in the target gross profit per EH/s estimates for the miners, the report noted.

“Our price targets generally declined due to share count dilution, lower bitcoin prices, and a rising network hashrate. We remain overweight on IREN, our top pick, and RIOT, while underweight on MARA, and are neutral on CIFR and CLSK,” stated JP Morgan analysts Reginald L. Smith and Charles Pearce, regarding publicly-traded bitcoin miners: Iris Energy, Riot Platforms, Marathon Digital, Cipher Mining, and CleanSpark.

Potential Bitcoin Miner Opportunities

Despite these downgrades, JPMorgan’s analysis indicates a potential for improved sentiment and share gains for both RIOT and IREN in the upcoming months. The report from Friday highlighted enhanced uptime and production metrics for RIOT, following the implementation of immersion-cooled miners at its Corsicana facility.

Additionally, the recent drop in IREN shares over the past three weeks—attributed to a significant rise in power costs in July due to power hedging losses—presents a potential opportunity.

“We believe these missteps are correctable and view the recent weakness as a favorable buying opportunity. Headlines like these highlight the consistently solid operations at CleanSpark and Cipher, which have demonstrated industry-leading uptime and expense management for several quarters,” the report concluded.