Key Takeaways
Riot Platforms Inc. (RIOT) received a new Buy rating and a $27.50 price target from Chardan, as the company’s pivot from Bitcoin mining to artificial intelligence data center hosting gains traction with its first revenue and an expanded deal with Advanced Micro Devices Inc. (AMD).
"RIOT is well-positioned on its strategic pivot towards AI/HPC workloads given access to 1.7GW of power capacity in Texas," Chardan analyst Bill Papanastasiou said, noting the company has a clear line of sight to full energization by year-end.
The bullish rating from Papanastasiou, a top-ranked Wall Street analyst, implies a 72 percent upside from Riot’s recent trading price of $15.98. The company recently signed a 10-year, $311 million agreement to lease 25 megawatts of capacity to AMD, and later announced a new 112-megawatt infrastructure development for data center tenants.
The move diversifies Riot’s revenue from the volatile Bitcoin mining sector into the high-growth AI infrastructure market. The company’s approximately $1.5 billion in liquidity, including its Bitcoin holdings, is seen as a key source of funding for the capital-intensive data center buildout.
The unanimous Strong Buy consensus rating from 13 analysts, with an average price target of $25.88, suggests Wall Street is broadly supportive of the strategic shift. Riot’s ability to secure a high-quality anchor tenant in AMD is expected to help it obtain project financing at a lower cost of capital.
Riot holds a distinct advantage through its subsidiary ESS Metron, which manufactures custom electrical equipment for its data centers. This in-house capability helps control costs and timelines for its facilities, including the 700-megawatt Rockdale data center, one of the largest in North America.
The successful execution of its data center strategy could lead to a significant re-rating of the company's valuation. Investors will be watching for further tenant announcements and progress on the energization of its full 1.7-gigawatt power capacity by the end of the year.
This article is for informational purposes only and does not constitute investment advice.
