TeraWulf Inc. (NASDAQ:WULF) is among the 11 Best Bitcoin and Blockchain Stocks to Invest in. Morgan Stanley Starts Coverage on TeraWulf Inc. (WULF) TeraWulf Inc. (NASDAQ:WULF) is among the Best Bitcoin Stocks.   Morgan Stanley started coverage on TeraWulf Inc. (NASDAQ:WULF) on February 9, 2026, with an Overweight rating and a $37 price target. The firm stressed the corporation’s history of obtaining contracts from data center clients and developing a variety of power infrastructure assets. Morgan Stanle ...

Core Viewpoint - The decline in Bitcoin prices has prompted crypto mining companies to pivot towards artificial intelligence (AI) as a more profitable venture [1]. Group 1: Market Dynamics - Smaller Bitcoin mining companies, like TeraWulf, are well-positioned to adapt quickly to market changes, with TeraWulf's market cap at $7 billion and a stock increase of 52% year-to-date and over 240% in the past year [2][10]. - The massive computing power used for Bitcoin mining is now being redirected to support AI projects, attracting interest from investment firms such as Morgan Stanley, which has begun covering the Bitcoin mining sector with a focus on AI infrastructure [3][5]. Group 2: Company Strategy - TeraWulf is recognized as a potential AI infrastructure play, with plans to expand its AI infrastructure through 2030, capitalizing on the high demand for AI computing [5]. - The company has been selling off Bitcoin to finance its AI operations, indicating a strategic shift towards AI as a more lucrative business model [8]. Group 3: Valuation Considerations - TeraWulf's valuation may depend on whether it is viewed as a Bitcoin miner or an AI infrastructure company; if considered a Bitcoin miner, its growth potential could be limited due to minimal Bitcoin holdings [9]. - Morgan Stanley has set a price target of $37 for TeraWulf, suggesting significant upside potential if the market views it as an AI infrastructure play [9].

Core Insights - The cryptocurrency market is experiencing volatility, with Bitcoin trading down from a high of $124,714.85 to a low of $62,839.77 over the past year, while recent price movements show slight increases for Bitcoin, Ethereum, and Solana [2][3] - Long-term expectations for digital assets remain positive due to a favorable regulatory environment and increasing institutional acceptance, particularly with the passage of the GENIUS Act [4] - Companies like Strategy and Riot Platforms are transitioning their business models to adapt to market changes, focusing on AI and high-performance computing (HPC) infrastructure [8][11] Cryptocurrency Market Overview - Cryptocurrencies operate on decentralized blockchain networks, enhancing security and transparency, which supports broader adoption and investor confidence [1] - Bitcoin has faced bearish sentiments due to macroeconomic conditions and tighter liquidity, impacting its trading performance [2] Company Performance - Coinbase reported earnings of 66 cents per share, missing estimates by 28.3%, and significantly down from $3.39 per share a year ago [3] - Strategy raised $25.3 billion in 2025, making it the largest equity issuer among U.S. public companies, and holds 713,502 bitcoins, representing about 3.4% of total bitcoin supply [6][7] - Riot Platforms is shifting from Bitcoin mining to data center development, with significant power capacity and plans for AI and HPC expansion [8][9] Strategic Developments - TeraWulf is evolving towards AI and HPC infrastructure, generating recurring revenues supported by long-term contracts, while also expanding its Bitcoin mining capacity [11] - The company aims to add 250-500 MW of HPC capacity annually, driven by strong demand in AI [11] Financial Considerations - Strategy's digital asset balance increased from $23.9 billion at the end of 2024 to $58.9 billion at the end of 2025, indicating strong liquidity [7] - Riot Platforms faces near-term capital expenditure pressures of approximately $214 million for its Corsicana buildout, alongside ongoing market volatility [10] - TeraWulf's shift towards HPC has raised operating costs and capital intensity, with total debt reaching roughly $1.5 billion [12]

Core Insights - Hodges Capital Management Inc. sold 919,169 shares of TeraWulf, valued at approximately $12.32 million, indicating a reduction in their stake during Q4 2025 [1][2] - The value of TeraWulf's position decreased by $10.30 million at quarter-end, reflecting both trading and share price movements [2] - TeraWulf shares were priced at $16.63 as of February 10, 2026, representing a 224.2% increase over the past year, significantly outperforming the S&P 500 by 209.74 percentage points [3] Company Overview - TeraWulf is a digital asset technology company focused on large-scale bitcoin mining operations in the U.S., utilizing proprietary infrastructure and energy solutions [6] - The company reported a total revenue of $167.60 million and a net income of -$586.64 million, with a market capitalization of $6.67 billion [4] - TeraWulf operates bitcoin mining facilities in New York and Pennsylvania, generating revenue from digital asset production and related services [9] Financial Performance - TeraWulf's revenue increased by 87% year-over-year to $50.6 million in the third quarter, including $7.2 million from high-performance computing lease revenue [10] - The company signed over $17 billion in long-term HPC contracts and completed more than $5 billion in financings to scale its platform [10] - Cash and restricted cash totaled $712.8 million, while total debt was approximately $1.5 billion [10] Investment Considerations - The volatility of bitcoin miners, including TeraWulf, suggests that trimming exposure after significant price increases can be a rational portfolio management strategy [7] - The combination of rapid growth, high capital needs, and exposure to cryptocurrency prices makes TeraWulf's stock inherently higher beta compared to steadier investments [11] - For long-term investors, the potential for stable cash flows from HPC leases could allow TeraWulf to evolve beyond being a pure bitcoin proxy [12]

Market Overview - Bitcoin price fell below $67,000, impacting the cryptocurrency and bitcoin mining stock sectors as traders adjusted expectations for Federal Reserve interest rate cuts following a strong jobs report for January [1] - The U.S. Bureau of Labor Statistics reported a payroll increase of 130,000 in January, surpassing the consensus estimate of 55,000, with the unemployment rate dropping to 4.3%, indicating a strong labor market that may lead to prolonged restrictive policies by the central bank [1] Company Performance - TeraWulf (NASDAQ: WULF) experienced a decline of 7.28%, reaching a morning low of $15.42, despite announcing the acquisition of industrial sites in Kentucky and Maryland to double its power capacity [3] - Cipher Mining (NASDAQ: CIFR) shares fell 6.67% to $15.96, even after pricing a $2 billion note offering for its "Black Pearl" data center in Texas, which was six times oversubscribed [4] - IREN (NASDAQ: IREN) dropped 5.94% to $40.38, continuing a downward trend after reporting a 23% decline in quarterly revenue, leading JPMorgan to maintain an "underweight" rating due to funding concerns [5] - Applied Digital (NASDAQ: APLD) fell 5.82% to $35.29, pulling back after a strong January performance where it gained 55% as an AI/HPC pure-play [5] - CleanSpark (NASDAQ: CLSK) traded down 3.69% to $9.66, despite an 11.6% revenue increase to $181.2 million and securing 890 MW of additional power capacity, unable to counter the sector-wide negative trend [6] - Hut 8 (NASDAQ: HUT) declined 4.90% to $52.21, awaiting zoning approval for a $5 billion data center project in Illinois [6] - Galaxy Digital (TSX: GLXY) fell 3.45% to $20.46 after reporting a fourth-quarter loss of $482 million due to lower cryptocurrency prices [7] - HIVE Digital (NASDAQ: HIVE) dropped 3.48% to $2.22, despite a 191% increase in monthly bitcoin production in January [7]

Core Insights - Morgan Stanley initiated coverage on Cipher Mining (CIFR) and TeraWulf (WULF) with overweight ratings, leading to significant share price increases for both companies, with price targets set at $38 for CIFR and $37 for WULF, indicating upside potential of approximately 158% and 159% respectively from their February 6, 2026 levels [1][8] Group 1: Investment Thesis - The primary catalyst for Morgan Stanley's bullish outlook is the companies' transformation from traditional bitcoin mining to high-demand AI data center services, positioning them similarly to Data Center REITs [3] - This strategic pivot allows CIFR and WULF to leverage their existing infrastructure and access to low-cost power, addressing the industry's structural shortage of AI compute capacity [4] Group 2: ETF Investment Opportunities - Investing in ETFs provides a safer alternative to individual stocks, offering built-in volatility buffers and diversification, which can mitigate risks associated with the high volatility of individual mining stocks [5][6] - Suggested ETFs for exposure to CIFR and WULF include: - Global X Blockchain ETF (BKCH) with net assets of $252.6 million, which has surged 26.8% over the past year [9] - Amplify Blockchain Technology ETF (BLOK) with net assets of $1.08 billion, gaining 17.2% over the past year [10] - Grayscale Bitcoin Miners ETF (MNRS) with assets under management of $11.04 million, rallying 28.2% over the past year [11] - VanEck Digital Transformation ETF (DAPP) with net assets of $286.5 million, increasing by 13.3% over the past year [12] - Schwab Crypto Thematic ETF (STCE) with net assets of $245 million, gaining 26.7% over the past year [14] - Spear Alpha ETF (SPRX) with net assets of $164.6 million, soaring 49.3% over the past year [16]

Core Insights - Bitcoin is currently trading below the average production cost for publicly listed miners, which is approximately $74,600, a situation that historically does not persist for long [1] - The gap between mining economics and current prices may indicate an approaching market bottom, especially as large holders have resumed buying after a period of selling [1] - Entities holding more than 10,000 bitcoin sold around $28 billion during the recent downturn but have since purchased approximately $4.7 billion in the last two weeks [1] - Trading volumes have reached historic highs, with global crypto exchange-traded product volumes hitting a record $18.5 billion on February 8, indicating potential final selling pressure [1] - The production cost threshold creates natural support levels, suggesting that spot prices remaining significantly below production costs are typically short-lived [1] Mining Sector Performance - The CoinShares Bitcoin Mining ETF (WGMI) has $201.3 million in assets and has returned 14.5% year-to-date, providing direct exposure to companies navigating production economics [1] - IREN Limited (IREN) is the largest position in the fund at 22.5% of assets, followed by Cipher Mining Inc. (CIFR) at 18.3% [1] - The CoinShares Bitcoin ETF (BRRR) holds $425.5 million in assets with a 0.25% expense ratio and has seen $4.56 million in net inflows over the past month [1] - Despite over 75% of bitcoin positions being underwater, behavioral and production-level signals suggest that downside momentum may be nearing exhaustion [1]

Core Viewpoint - The CoinShares Valkyrie Bitcoin Miners ETF (WGMI) has shown a remarkable performance, increasing by 13% since the start of 2026, despite the overall downturn in the cryptocurrency market [1] WGMI Holdings Performance - Cipher Mining (CIFR) and Terawulf (WULF) received "overweight" ratings from Morgan Stanley analyst Stephen Byrd, highlighting their transition from crypto-focused companies to significant players in the AI sector [1] - Byrd emphasized that once a bitcoin company establishes a data center and secures a long-term lease with a reliable counterparty, its appeal shifts from bitcoin investors to infrastructure investors [1] - Cipher Mining's valuation is expected to grow as its data center exposure increases, although it may not reach the multiples of traditional data center real estate investment trusts (REITs) [1] - Terawulf is recognized for its strong track record in signing agreements with data center customers and has a management team experienced in building diverse power infrastructure assets [1]

Core Viewpoint - TeraWulf Inc. (NASDAQ:WULF) has shown significant stock performance, rising by 16.52% to $16.62, driven by Morgan Stanley's positive outlook and an "overweight" rating with a price target of $37, indicating a 123% upside potential from its latest closing price [1][2]. Group 1: Company Performance - TeraWulf's stock surged due to Morgan Stanley's bullish coverage, which highlighted the company's transition from bitcoin mining to servicing the artificial intelligence sector [1][2]. - The company is set to release its earnings results for Q4 and full-year 2025 on February 26, after market close [3]. Group 2: Strategic Developments - TeraWulf has acquired two land parcels that can support 1,480 MW of new digital and power capacity, including a site in Hawesville, Kentucky, with 250 buildable acres and existing power operations of 480 MW [3][4]. - The Maryland site acquisition includes a 250-acre parcel housing the Morgantown Generating Station, capable of approximately 210 MW of operational generation capacity, with potential for expansion to 1 GW [4][5]. Group 3: Market Positioning - Morgan Stanley believes that once TeraWulf establishes data centers and long-term leases with reliable partners, the company will benefit from stable cash flow and asset valuation [2].

Core Insights - The article emphasizes the importance of investing in AI infrastructure companies, referred to as "pick-and-shovel plays," which are expected to benefit from the rapid growth of artificial intelligence and high-performance computing [1] Group 1: AI Infrastructure Companies - Companies like Nebius Group (NBIS), IREN (IREN), Astera Labs (ALAB), TeraWulf (WULF), and Cipher Mining (CIFR) are positioned to profit regardless of which AI model prevails, offering stable revenues and broad industry exposure [1] - Nebius Group is projected to experience a remarkable revenue growth of 5x by 2026, indicating strong market potential [7] Group 2: AI Capital Expenditure Trends - Hyperscaler capital expenditure (CAPEX) is forecasted to increase from $390 billion in 2025 to $515 billion in 2026, reflecting a significant rise in AI-related spending [2][3] - AI spending now constitutes over 2% of GDP, surpassing historical investments in railroads during the 1850s, highlighting the critical role of AI in the economy [2] Group 3: Productivity and Market Dynamics - The proliferation of AI technology has led to a 30% increase in coding productivity, countering skepticism regarding the return on investment in AI [9][11] - Companies are transitioning from capital-intensive models to high-margin operations, as seen with IREN's shift to a GPU-as-a-Service model, resulting in gross profits rising from under $200 million to $600 million [12] Group 4: Market Sentiment and Technical Analysis - A bullish shakeout pattern has been observed in stocks like NBIS, where prices briefly fell below key support levels before rebounding, indicating potential for future price increases [13] - The current market environment presents a unique opportunity for investors to focus on AI infrastructure providers, minimizing the uncertainty associated with software competition in the AI sector [15]