Analyst Kevin Dede of H.C. Wainwright reiterated a Buy rating on Bit Digital (BTBT – Research Report), with a price target of $4.00.
Kevin Dede’s Buy rating for Bit Digital is largely influenced by the company’s recent strategic move to diversify its revenue streams. This comes after the announcement of a deal with several parties, including an anonymous end HPC customer and an equipment OEM, xFusion. The agreement promises to yield over $250M in revenue for Bit Digital over a span of three years, beginning January 2023. The income will be generated from the company’s new business line where it offers tier-3 data center access, facilitated by the first tranche of 1,056 Nvidia H100 GPUs supplied in 132 Bit Digital-owned FusionOne HPC servers built by xFusion.
The analyst also lauds Bit Digital’s decision to place a 20% deposit on the $35M FusionOne HPC machine purchase order, which they will eventually own outright. Moreover, Dede appreciates the company’s business diversification philosophy, which mitigates concerns over scale, capital allocation, and bitcoin volatility. Bit Digital has executed a variety of projects aimed at reducing bitcoin mining exposure, including a unique process that intertwines Ethereum staking with bitcoin mining, and a lending platform through Auros Global Limited. The recent HPC deal highlights Bit Digital’s core competencies in sourcing equipment and co-location facilities, further solidifying Dede’s confidence in the company’s future performance.
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Bit Digital (BTBT) Company Description:
Golden Bull Ltd. is an online finance marketplace lending company, which engages in the provision of short-term loans. Through its online marketplace, the company connects individual lenders with individual and small business borrowers. The company was founded by Er Xin Zeng in November 2015 and is headquartered in Shanghai, China.
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