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Hut 8 (TSE:HUT)
TSX:HUT
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Hut 8
(TSX:HUT)
Rating:54Neutral
Price Target:
C$29.00
▼(-1.36%Downside)
Positive Factors
Bitcoin Mining Expansion
HUT's bitcoin mining hashrate increased to 9.3 EH/s from 5.5 EH/s at year-end 2024 due to new equipment purchases and installations.
Infrastructure Development
HUT is well-positioned to capitalize on global demand trends for AI infrastructure, with a significant exclusive pipeline and near-term deliverability.
Strategic Growth
The go-public merger with Gryphon allows HUT to monetize its infrastructure via hosting and managed services, creating long-term contracted revenue and higher cash flow streams.
Negative Factors
Financial Performance
1Q25 results were light as old contracts and equipment rolled off, with revenue coming in below estimates and consensus.
HPC Progress
HPC progress remains limited, and it is now expected that the main customer in talks for River Bend, LA to be considering 130MW with HUT at an alternate site.
Operational Challenges
Revenue was negatively impacted by the termination of an agreement with Ionic and delays in new bitcoin mining equipment moving through customs.
Hut 8 (HUT) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$3.39B
Dividend YieldN/A
Average Volume (3M)1.43M
Price to Earnings (P/E)3.8
Beta (1Y)2.44
Revenue Growth15.44%
EPS Growth-134.04%
CountryCA
Employees222
SectorFinancial
Sector Strength74
IndustryFinancial - Capital Markets
Share Statistics
EPS (TTM)-1.81
Shares Outstanding115,223,040
10 Day Avg. Volume1,501,215
30 Day Avg. Volume1,426,561
Financial Highlights & Ratios
PEG Ratio0.23
Price to Book (P/B)2.31
Price to Sales (P/S)0.00
P/FCF Ratio-5.64
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$34.74Price Target Upside18.16% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering13
Hut 8 Business Overview & Revenue Model
Company DescriptionHut 8 Mining Corp. operates as a cryptocurrency mining company in North America. The company engages in industrial scale bitcoin mining operations. It also owns and operates 38 BlockBoxes in Drumheller, Alberta; and 51 BlockBoxes in Medicine Hat, Alberta. Hut 8 Mining Corp. was incorporated in 2011 and is headquartered in Toronto, Canada.
How the Company Makes MoneyHut 8 makes money primarily through the mining of cryptocurrencies, such as Bitcoin. The company generates revenue by solving complex mathematical problems that secure the Bitcoin network and, in return, earns block rewards and transaction fees in the form of newly minted Bitcoin. These mined Bitcoins can then be held as an asset or sold on the open market to generate cash flow. Additionally, Hut 8 may engage in strategic partnerships and investments that complement its mining activities, such as collaborating with technology providers to enhance mining efficiency or exploring opportunities in blockchain and digital asset innovation. The company's revenue is directly impacted by cryptocurrency market prices, mining difficulty, and operational efficiency.
Hut 8 Earnings Call Summary
Earnings Call Date:May 08, 2025
(Q1-2025)
| % Change Since: 68.48%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook. On one hand, Hut 8 demonstrated strategic growth plans with the expansion of its Power origination pipeline and successful fleet upgrades, contributing to potential future gains. The launch of American Bitcoin is positioned to strategically navigate the Bitcoin mining sector. However, the call also highlighted significant immediate financial setbacks, including a substantial revenue decline, net loss, and increased operating costs. While the company's strategic moves may yield future benefits, the current financial performance reflects notable challenges.Q1-2025 Updates
Positive Updates
Power Origination Pipeline
As of March 31, 2025, Hut 8's Power origination pipeline spanned approximately 10,800 megawatts with approximately 2,600 megawatts under exclusivity, indicating a strong position for future growth.
Fleet Upgrade and Efficiency
Completed a fleet upgrade, resulting in a 79% increase in deployed hash rates and a 37% improvement in fleet efficiency quarter-over-quarter, enhancing mining economics.
Strong Balance Sheet
Hut 8 ended the quarter with 10,264 Bitcoin held in reserve, representing $847.2 million in market value, indicating solid financial health.
American Bitcoin Launch
The launch of American Bitcoin as a dedicated entity to operate Bitcoin mining operations, aiming to accumulate Bitcoin at scale with exceptional speed and efficiency.
Negative Updates
Revenue Decline
Revenue for the quarter was $21.8 million, down from $51.7 million in the prior year, primarily due to planned downtime and increased network difficulty post-Bitcoin halving.
Net Loss and EBITDA
Reported a net loss of $134.3 million for the quarter versus net income of $250.7 million in the prior year and adjusted EBITDA of negative $117.7 million, impacted by non-cash losses and external economic factors.
Increased Energy Costs
Energy costs per megawatt hour rose to $51.71 from $40.06 in the prior year due to fixed transmission and distribution charges, affecting operating costs.
Company Guidance
During the first quarter of 2025, Hut 8 focused on strategic investments to advance its evolution as an integrated energy infrastructure platform. The company reported a revenue of $21.8 million, a decline from $51.7 million in the previous year, mainly due to planned downtime for fleet upgrades and the April 2024 Bitcoin halving. This resulted in a net loss of $134.3 million compared to a net income of $250.7 million the prior year. Adjusted EBITDA was negative $117.7 million, down from $297 million. The company's energy costs per megawatt hour rose from $40.06 to $51.71, influenced by fixed charges amidst reduced consumption. Despite these challenges, Hut 8 ended the quarter with 10,264 Bitcoin, valued at $847.2 million. The period marked the launch of American Bitcoin, intended to streamline capital allocation and enhance growth in the Power and Digital Infrastructure segments.Hut 8 Financial Statement Overview
Summary
Hut 8 faces significant financial challenges with a negative gross profit margin, substantial net loss, and cash burn issues. While the balance sheet shows reasonable equity levels, the income and cash flow statements indicate volatility and inefficiencies. Improvements in operational efficiency and cash management are critical.Income Statement
Hut 8's income statement shows significant challenges with profitability and revenue stability. The TTM data indicates a negative gross profit margin and a substantial net loss, highlighting operational inefficiencies. EBIT and EBITDA margins are skewed by high depreciation and amortization costs. Revenue growth has been inconsistent, reflecting volatility in financial performance.35
Negative
Balance Sheet
The balance sheet reflects a moderate financial structure with reasonable equity levels. The debt-to-equity ratio is manageable, suggesting a balanced approach to leveraging. However, the equity ratio indicates some room for improvement in asset utilization. While stockholders' equity is substantial, the overall asset base has seen fluctuations, which may impact financial stability.60
Neutral
Cash Flow
Cash flow analysis reveals significant concerns, primarily due to negative operating and free cash flows, indicating cash burn issues. The operating cash flow to net income ratio is negative, suggesting inefficiencies in cash generation from core operations. The negative free cash flow growth rate further emphasizes the need for improved cash management strategies.30
Negative
| Breakdown | Dec 2024 | Dec 2023 | Jun 2023 | Dec 2019 | Dec 2018 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 671.72M | 81.80M | 150.68M | 81.99M | 49.44M |
| Gross Profit | 585.07M | 21.17M | -24.97M | 2.13M | -23.48M |
| EBITDA | 531.11M | 1.36M | 3.57M | 30.40M | -2.76M |
| Net Income | 331.88M | 16.45M | -242.81M | 2.13M | -136.77M |
Balance Sheet | |||||
| Total Assets | 1.52B | 976.87M | 412.94M | 71.24M | 82.90M |
| Cash, Cash Equivalents and Short-Term Investments | 85.04M | 47.36M | 30.52M | 2.95M | 3.56M |
| Total Debt | 345.65M | 268.75M | 47.42M | 26.04M | 32.37M |
| Total Liabilities | 538.28M | 333.87M | 55.55M | 28.54M | 50.24M |
| Stockholders Equity | 976.67M | 643.00M | 357.39M | 42.70M | 32.66M |
Cash Flow | |||||
| Free Cash Flow | -333.13M | -27.30M | -177.74M | 5.27M | -91.14M |
| Operating Cash Flow | -68.53M | -26.48M | -105.03M | 14.51M | -6.77M |
| Investing Cash Flow | -188.47M | 87.25M | -103.61M | -9.73M | -90.16M |
| Financing Cash Flow | 311.95M | -33.45M | 99.83M | -5.39M | 77.24M |
Hut 8 Technical Analysis
Positive
29.40
Price Trends
25.36
Positive
21.62
Positive
25.98
Positive
Market Momentum
1.43
Positive
59.59
Neutral
33.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:HUT, the sentiment is Positive. The current price of 29.4 is above the 20-day moving average (MA) of 28.57, above the 50-day MA of 25.36, and above the 200-day MA of 25.98, indicating a bullish trend. The MACD of 1.43 indicates Positive momentum. The RSI at 59.59 is Neutral, neither overbought nor oversold. The STOCH value of 33.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:HUT.
Hut 8 Peers Comparison
Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $17.10B | 11.62 | 9.70% | 3.86% | 11.32% | -7.37% | |
56 Neutral | C$190.64M | 60.00 | -0.89% | ― | -9.36% | ― | |
54 Neutral | C$3.39B | 3.76 | -6.53% | ― | 15.44% | -134.04% | |
| ― | $513.60M | ― | -15.83% | ― | ― | ― | |
| ― | $32.17M | ― | -110.80% | ― | ― | ― | |
| ― | $731.81M | ― | -16.30% | ― | ― | ― | |
| ― | $11.71B | ― | -23.34% | ― | ― | ― |
* Financial Sector Average
Performance Comparison
TSE:HUT
Hut 8
29.40
8.95
43.77%
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2.40
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Neptune Digital Assets
1.50
1.22
435.71%
BBKCF
BIGG Digital Assets
0.09
-0.03
-25.00%
BITF
Bitfarms
1.27
-1.31
-50.78%
GLXY
Galaxy Digital
31.03
19.82
176.81%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.