Macquarie Coverage on Cryptocurrency Mining Companies

Macquarie has initiated coverage on key cryptocurrency mining companies, including Marathon Digital Holdings (NASDAQ: MARA), Core Scientific (CORZ), CleanSpark (NASDAQ: CLSK), Riot Platforms (NASDAQ: RIOT), and Cipher Mining (NASDAQ: CIFR), giving them all Outperform ratings.

This new coverage complements their existing analysis of Iris Energy (IREN).

Market Insights

In their report, Macquarie indicated that these companies are well-placed to thrive in the evolving digital asset ecosystem, particularly as they diversify into AI and high-performance computing (HPC).

Strategies in Crypto Mining

Analysts identified two main strategies within the cryptocurrency mining sector:
– Diversification into Non-Crypto Services: Some miners are leveraging their power infrastructure to branch into hosting for non-crypto services, such as AI clients.
– Focusing on Bitcoin Accumulation: Conversely, some miners prefer to concentrate on Bitcoin acquisition, anticipating price rises.

It was pointed out that growth in mining capacity and land/GPU acquisition for HPC/AI often comes through dilutive equity issuance.

Notable Companies

Macquarie highlighted Core Scientific (CORZ) and Iris Energy (IREN) for their proactive approach to AI-related hosting, with Core Scientific leveraging a deal with CoreWeave to capitalize on the rising demand for AI compute infrastructure, positioning it for significant growth.

Cipher Mining (CIFR) is recognized for its advancements at its Odessa site, which supports both Bitcoin mining and HPC. Macquarie analysts assert that Cipher's focus on power efficiency and scalability could lead to an imminent increase in profitability, with a target price set at $6.

Riot Platforms (RIOT) continues to excel in Bitcoin cooling technology, particularly noted for its integrated operations in power and infrastructure management. Macquarie has set a $15 target price for Riot, citing its operational efficiency potential.

Finally, Marathon Digital (MARA) and CleanSpark (CLSK) receive acknowledgment for their comprehensive exposure to Bitcoin infrastructure and acquisition strategies, with target prices of $22 and $20, respectively.