"The deal validates Hut 8's power-first approach to building out AI infrastructure," wrote Mark Palmer, equity research analyst at Benchmark, in a Wednesday note that bumped his price target on the company from $165 to $195. That puts the implied upside at roughly 80% from the stock's current price of around $110. Palmer kept his "buy" rating in place.
The trigger was a second 15-year lease Hut 8 signed Monday for 352 megawatts of IT capacity at its Beacon Point campus in Nueces County, Texas. The deal doubles the site's contracted tenant load to 704 MW and fully commercializes the campus against its 1,000 MW of available utility capacity. Hut 8 shares jumped more than 10% on the announcement, closing near $101 after briefly touching $106 intraday. The lease is valued at $9.8 billion, and Palmer estimates it alone could generate roughly $655 million per year in net operating income once fully stabilized. If renewal options are exercised, he puts the campus's total contract value as high as $50.2 billion.
Hut 8 is not the only Bitcoin miner chasing this pivot. Terawulf, IREN, and Cipher Mining have all signed multi-year high-performance computing contracts with Google and Microsoft, while Bitfarms went further last year, announcing it would wind down mining altogether to focus on HPC. Hut 8 takes a different line: it still runs an active mining business through its majority stake in American Bitcoin, the venture backed by Eric Trump and Donald Trump Jr. That stake keeps the company exposed to Bitcoin price swings and rising network difficulty, but the AI buildout is clearly where management is placing its biggest bets. Back in December, the company signed a Google-backed agreement with Anthropic and Fluidstack to develop up to 2.3 gigawatts of AI data center capacity across the United States.
Investors will get a clearer picture of how all this is flowing through the income statement when Hut 8 reports second-quarter earnings on August 4.
This article is for informational purposes only and does not constitute financial or investment advice.
