Hut 8 (HUT) Stock: Why Wall Street’s Highest Price Target Just Hit $85

TLDR

• Hut 8 stock jumped 3.1% in premarket trading after Benchmark analyst raised price target to $85, the highest on Wall Street
• The company signed a $7 billion, 15-year data center deal with Fluidstack for 245 MW of AI hosting capacity at River Bend campus in Louisiana
• Benchmark values the contracted cash flow and power demand at approximately $7.6 billion
• Stock has returned 102% year-to-date, closing at $44.12 against analyst fair value estimate of $56
• Current P/E ratio of 23.4x sits above calculated fair ratio of 7.9x, raising questions about valuation stretch

Hut 8 shares are on the move again. The stock climbed 3.1% in premarket trading Monday following a price target boost from Benchmark analyst Mark Palmer.

Hut 8 Corp., HUT

Palmer raised his target to $85 from $78. That’s now the highest price target on Wall Street for the crypto miner turned infrastructure play.

The upgrade comes on the heels of Hut 8’s freshly inked $7 billion data center agreement. Palmer sees the deal as a turning point for the company’s business model.

The 15-year lease with Fluidstack covers 245 megawatts of AI hosting capacity. The site is Hut 8’s River Bend campus in Louisiana.

Palmer believes this transaction shifts Hut 8’s focus from crypto mining to digital infrastructure. The change should improve revenue quality and make cash flows more predictable.

Valuation Gap Emerges

Benchmark puts the value of the contracted cash flow and power demand at River Bend at roughly $7.6 billion. That’s just for the 245 MW covered in the current deal.

The stock closed recently at $44.12. That’s up 102% year-to-date, a strong run by any measure.

Analysts currently peg fair value around $56, suggesting the shares still trade at a discount. Price targets from other firms generally fall in the $60 to $65 range.

Those targets assume Hut 8 will extract more value from its multi-gigawatt development pipeline. The company is betting big on high-performance computing demand.

Valuation Concerns Surface

The optimism isn’t universal. Some analysts point to stretched valuation metrics that don’t quite line up with the bullish narrative.

Hut 8’s current P/E ratio sits at 23.4x. One analysis suggests a fair ratio closer to 7.9x based on fundamentals.

That’s a wide gap. It raises the question of whether the market is already pricing in flawless execution of the company’s infrastructure pivot.

The stock does trade below the broader US software sector average on a P/E basis. But compared to peers on fundamentals alone, it appears rich.

Palmer also highlighted Hut 8’s ownership stake in Bitcoin mining firm American Bitcoin as a positive. That adds another layer to the story beyond the data center play.

Risks remain on the table. A prolonged Bitcoin downturn could pressure the legacy mining business. Regulatory pushback on fossil-fuel-based power generation could complicate the company’s expansion plans.

The Fluidstack deal includes embedded expansion options across three counterparties: Anthropic, Fluidstack, and Google. Those options could drive additional growth if demand for AI computing continues to surge.

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