On Friday, B.Riley raised the stock price target for Core Scientific Inc. (NASDAQ: CORZ) to $14.00 from $13.00, while maintaining a Buy rating on the stock. The adjustment reflects the company's ongoing developments and operational updates.
In September, Core Scientific reported a slight 3.6% month-over-month decrease in self-mined Bitcoin (BTC), producing 345 BTC. This decline was attributed to the migration of miners to new data centers and the removal of all ASIC miners from two of the company's BTC mining data centers in preparation for High Performance Computing (HPC) conversion. Despite these changes, the company maintained an estimated utilization rate of 79% for the month.
As of September 30, Core Scientific owned approximately 175,000 ASIC miners, representing about 89% of the BTC miners in its data centers. The total energized hash rate stood at 20.4 EH/s, a slight decrease of 0.5% from the previous month. The company's expansion efforts continue, with a 100 MW data center in Pecos, Texas, on schedule. This new capacity is set to house BTC miners relocated from sites undergoing modifications for HPC hosting.
Additionally, Core Scientific has initiated construction on a substation at its Muskogee, Oklahoma location. This project aims to build a 100 MW data center equipped with liquid cooling systems designed for AI GPU cloud workloads.
Investors have been closely monitoring the potential for CoreWeave to execute its option for the remaining 118 MW of HPC capacity, as the 30-day window for this decision expired earlier in the week. The analyst expressed confidence that CoreWeave is likely to secure this capacity, but also noted that Core Scientific would be able to find another high-quality tenant if necessary.
In other recent news, Core Scientific, a major player in digital infrastructure and bitcoin mining, has reported several significant developments. The company mined 345 bitcoins in September, adding to a total of 5,621 bitcoins mined year-to-date. Core Scientific also announced that it sold 370 bitcoins in September, generating sales proceeds of approximately $22.2 million.
In terms of corporate changes, Core Scientific's CFO, Denise Sterling, is set to step down by May 2025, and a search for her successor has been initiated. The company has also managed to reduce its financial burden by repaying $267 million in high-interest debt, a move made possible by the proceeds from its recent convertible senior notes offering.
On the analyst front, Canaccord Genuity initiated a Buy rating for Core Scientific, based on the company's recent deal with CoreWeave for high-performance computing hosting. Analysts from Cantor Fitzgerald and H.C. Wainwright also gave positive ratings, reflecting confidence in the company's recent developments.
In the realm of contracts, Core Scientific has secured $6.7 billion in high-performance computing contracts, including a 12-year agreement with CoreWeave, which is expected to contribute $2.0 billion to its cumulative revenue. These are the recent developments at Core Scientific.
InvestingPro Insights
Core Scientific Inc. (NASDAQ: CORZ) has been demonstrating strong financial performance and market dynamics, as reflected in recent InvestingPro data. The company's market capitalization stands at $3.09 billion, indicating significant investor interest. Despite not being profitable over the last twelve months, analysts predict that Core Scientific will turn profitable this year, which aligns with the company's ongoing operational improvements and expansion efforts mentioned in the article.
InvestingPro Tips highlight Core Scientific's impressive stock performance, with a strong return over the last month (20.06%) and a remarkable 299% return over the last six months. This surge in stock price correlates with the company's strategic moves, including the migration of miners and the development of new data centers for High Performance Computing.
The company's revenue growth of 8.25% over the last twelve months and a quarterly growth of 11.18% in Q2 2024 suggest that Core Scientific is on a positive trajectory, supporting B.Riley's decision to raise the price target. Additionally, the EBITDA growth of 517.26% over the last twelve months is particularly noteworthy, indicating substantial improvement in the company's operational efficiency.
For investors seeking more comprehensive analysis, InvestingPro offers 11 additional tips for Core Scientific, providing a deeper understanding of the company's financial health and market position.
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