Core Insights - J.P. Morgan updated financial models for North American Bitcoin miners, adjusting price targets based on network difficulty and cryptocurrency price fluctuations [1] Group 1: Bitcoin Mining Revenue Projections - Analysts project a modest decline in bitcoin mining revenue for Q4 2025, with estimates for mined bitcoin increasing by a low single-digit percentage due to slower network hashrate growth, while lower realized bitcoin prices offset production gains [2] Group 2: Company Ratings and Price Targets - Cipher Mining (NASDAQ: CIFR) received an overweight rating with an $18 price target, reflecting its power pipeline and pivot toward AI/HPC, alongside a $2 billion debt offering and a 200-megawatt site acquisition in Ohio expected to come online in late 2027 [3] - CleanSpark (NASDAQ: CLSK) holds an overweight rating with a $14 price target, emphasizing its acquisition strategy, including two sites in Texas and ongoing negotiations for potential AI/HPC tenants [4] - Riot Platforms (NASDAQ: RIOT) maintains an overweight rating with a $20 price target, focusing on the capacity potential at its 1 GW Corsicana facility, assuming 600 megawatts of colocation deals by late 2026 [5] - Marathon Digital Holdings (NASDAQ: MARA) is rated overweight with a $13 price target, reflecting its revised year-end 2025 hashrate goal of 75 EH/s [5] - Iris Energy (NASDAQ: IREN) holds an underweight rating with a $39 price target, as the current valuation of approximately $54 is viewed as stretched, factoring in undeveloped site deals that have not materialized [6] Group 3: Regulatory Considerations - J.P. Morgan highlighted an ERCOT proposal that could impact bitcoin miners in Texas, with an interconnection backlog exceeding 250 gigawatts and proposed rules including a "use it or lose it" clause subject to annual reviews, to be presented to state regulators on February 20 [7] - Investors are advised to monitor management commentary from CleanSpark and IREN regarding the ERCOT rule during their earnings report on February 5 [7]

Group 1 - Cryptocurrency concept stocks experienced significant declines, with mining companies leading the drop [1] - IREN Ltd (IREN.US) fell nearly 11%, Hut8 (HUT.US) dropped over 9%, Cipher Mining (CIFR.US) decreased nearly 9%, and TeraWulf (WULF.US) declined over 8% [1] - Other stocks such as MicroStrategy (MSTR.US) and Bitmine Immersion Technologies (BMNR.US) also saw declines of over 3% [1] Group 2 - Bitcoin plummeted over 4%, falling below $75,000 [1] - Ethereum dropped more than 5%, trading at $2,181.25 [1]

Group 1 - Cryptocurrency stocks experienced significant declines, with mining companies leading the drop [1] - IREN Ltd (IREN.US) fell nearly 11%, Hut 8 (HUT.US) dropped over 9%, Cipher Mining (CIFR.US) decreased nearly 9%, and TeraWulf (WULF.US) declined over 8% [1] - Other cryptocurrency-related stocks such as MicroStrategy (MSTR.US) and Bitmine Immersion Technologies (BMNR.US) also saw declines of over 3% [1] Group 2 - Bitcoin plummeted over 4%, falling below $75,000, while Ethereum dropped more than 5%, trading at $2,181.25 [1]

Core Viewpoint - IREN is expected to report its 2Q26 results, and the stock is maintained as a buy ahead of the earnings announcement [1] Company Analysis - The analyst has a background as a retired Wall Street portfolio manager specializing in Technology, Media, and Telecommunications (TMT) [1] - The analyst has over two decades of experience in the market, focusing on risk mitigation during significant market events such as the dot-com bubble, the credit default crisis of 2008, and the recent AI boom [1] - The investment strategy revolves around momentum, indicating a focus on stocks that are trending positively [1]

With big tech earnings in focus, smart investors are looking at who the hyperscalers are partnering with.As earnings season comes into focus, growth investors are paying close attention to artificial intelligence (AI) stocks in particular. Among the most scrutinized names are the hyperscalers: Microsoft, Alphabet, Meta Platforms, and Amazon (AMZN +1.60%).On Feb. 5, Amazon will report earnings for the fourth quarter and full year 2025. While investors anxiously await updates regarding the company's performan ...

Core Insights - IREN Limited is set to report its second-quarter fiscal 2026 results on February 5, with a focus on GPU fleet expansion and data center development, which are expected to enhance revenue visibility and operational scale [1] GPU Expansion and AI Cloud Revenue Growth - IREN's AI Cloud Services revenues are anticipated to show strong performance in Q2 fiscal 2026, driven by a clear execution roadmap and robust infrastructure readiness [3] - The company plans to increase its GPU capacity from approximately 23,000 units to about 140,000 GPUs by the end of 2026, utilizing around 460MW, or roughly 16%, of its nearly 3GW secured power portfolio [3] - The transition of British Columbia locations from ASIC mining to GPU operations can support over 60,000 GPUs, potentially generating up to $1 billion in incremental annualized run-rate revenues from the additional 40,000 GPUs deployed at Mackenzie and Canal Flats [3][4] - The Zacks Consensus Estimate for AI Cloud Services revenues is projected at $31.2 million, reflecting significant year-over-year growth from $2.7 million in the same quarter last year [4] Data Center Growth and Infrastructure Development - IREN's expanding data center platform is expected to contribute to stronger growth in Q2 fiscal results, with rapid construction progress and AI-ready infrastructure [5] - The Childress campus is developing Horizons 1–4 with 200MW of liquid-cooled IT load for phased GPU deployments for Microsoft through 2026, with plans for Horizons 5–10 to convert the entire 750MW site to liquid-cooled AI operations [5] - The Sweetwater hub in Texas is set for substantial long-term scalability, with Sweetwater 1 (1.4GW) scheduled for energization in April 2026 and Sweetwater 2 planned for late 2027 [6] Capital Expenditure and Financial Outlook - IREN's capital-intensive expansion strategy requires an estimated $5.8 billion in GPU and infrastructure investments, which may pressure financial results due to funding and dilution risks [7][9] - Customer prepayments and secured GPU financing will partially fund the expansion, but additional capital will need to be sourced through cash reserves, operating cash flow, debt, equity issuance, and convertible notes [7][9] - The financing mix is expected to increase leverage and dilute shareholders, potentially impacting second-quarter fiscal 2026 performance [9]

Group 1 - The author of Novo Capital has five years of experience providing strategic insights and analysis for clients in the private banking sector of a leading Central Asian bank [1] - The methodology developed by the author focuses on corporate valuation, due diligence for investment opportunities, and accurate forecasting to guide long-term investment strategies [1] - Novo Capital was created to discuss investment ideas and gain "alpha" through out-of-consensus information that is not widely available among professionals [1]

Core Viewpoint - IREN Limited is expected to report significant revenue growth of 92.42% year-over-year for Q2 fiscal 2026, but faces a widening bottom-line loss, indicating deteriorating earnings quality compared to the previous year [1][7]. Financial Performance - The Zacks Consensus Estimate for Q2 fiscal 2026 revenues is $230.12 million, reflecting a substantial increase from the previous year [1]. - The consensus estimate for the bottom-line loss is 9 cents, which has widened by two cents over the past month, contrasting with earnings of 9 cents in the same quarter last year [1]. - Over the last four quarters, IREN has missed earnings expectations three times, with an average negative earnings surprise of 26.52% [2]. Earnings Expectations - IREN currently has an Earnings ESP of -39.29% and a Zacks Rank of 3, indicating a lower likelihood of an earnings beat this quarter [4][3]. - The company’s earnings quality is expected to weaken due to the absence of unrealized gains that previously inflated net income and EBITDA [9]. Operational Factors - IREN is expanding its GPU capacity from 23,000 to a targeted 140,000 GPUs by the end of 2026, which is expected to support revenue growth amid rising AI cloud demand [5]. - The company has a strong liquidity position with approximately $1.8 billion in cash, which helps sustain its Bitcoin mining operations despite power cost volatility [6]. Capital Expenditure and Strategy - IREN plans to invest approximately $5.8 billion in GPUs and related infrastructure, which may increase leverage and dilute shareholders [8]. - The company’s capital-intensive expansion strategy poses risks to financial flexibility and performance in the near term [7][17]. Competitive Landscape - IREN faces heightened competition in the AI cloud and HPC sectors from rapidly expanding peers like Applied Digital and TeraWulf, which may impact its growth objectives [16]. - Despite a strong liquidity position and operational momentum, the company’s premium valuation raises downside risk [17]. Stock Performance - IREN's shares have declined 1.5% over the past three months, underperforming the broader Finance sector, which returned 4.3% [10]. - The stock is currently considered overvalued, with a forward 12-month price/sales ratio of 8.04, significantly higher than the industry average of 3.03 [12].

Core Insights - Both Iren and Applied Digital have transitioned from the crypto industry to focus on AI and high-performance computing, each adopting different strategies to capture AI-related business opportunities [2][5] Company Overview: Iren - Iren's stock has increased over 400% in the past year, with a current market cap of $20 billion and a high forward price-to-earnings (P/E) ratio of around 50 [4] - The company recently secured a $9.7 billion AI cloud contract with Microsoft, leading to a significant improvement in net income from a loss of $51.7 million in Q1 of the previous fiscal year to a gain of $384.6 million in Q1 of fiscal 2026 [4][3] - Iren retains flexibility by operating in both crypto and high-performance computing, allowing it to adapt based on market demand [3] Company Overview: Applied Digital - Applied Digital's stock has surged over 500% in the past year, with a current market cap of $11 billion and a gross margin of 16.40% [6][7] - The company reported a 250% increase in revenue in its latest quarter, benefiting from multibillion-dollar leases with hyperscalers and a backlog of $16 billion [7] - Applied Digital focuses on building high-performance data centers and offering long-term leases, which provides predictable cash flows [5] Investment Considerations - Investors seeking cash flow predictability may find Applied Digital more appealing due to its stable revenue from contracts [8] - Iren offers optionality and upside potential but comes with higher volatility due to the cyclical nature of crypto and uncertainties in the AI compute market [8][9] - Both companies have shown significant returns driven by positive sentiment towards AI infrastructure, but they are not considered low-risk investments [9]

Core Insights - IREN LIMITED (NASDAQ:IREN) is transitioning from a crypto mining company to a leader in AI infrastructure, positioning itself for potential outperformance in the AI sector [1][4][6] - The S&P 500 is reaching record highs, driven by technology and AI stocks, encouraging a shift towards higher-risk investments in AI infrastructure [2] - IREN's Sweetwater 1 facility, with a capacity of approximately 1.4 gigawatts, is crucial for realizing its Annual Recurring Revenue (ARR) and sustaining valuation into fiscal year 2026 [3][4] Company Performance - IREN's stock price is currently around $57.85, reflecting a decrease of about 8.09% from a previous high of $76.87 over the past year [5] - The company has a market capitalization of approximately $16.4 billion, with a trading volume of around 17.8 million shares today [5] - IREN's stock has seen an 8.30% increase recently, indicating growing momentum in the market [4][6] Industry Context - IREN and CoreWeave Inc. are recognized as leading players in the AI infrastructure sector, with significant investments driving their growth [2][6] - CoreWeave has received a $2 billion investment from Nvidia, enhancing its partnership and expansion efforts [2] - The AI infrastructure sector is experiencing a rebound, with companies like IREN positioned to capitalize on the increasing demand for AI workloads [2][4]