Investing.com — Hut 8 Corp (NASDAQ:HUT) shares rose 3% following rumors that the company received approval to build a 300 MW data center in Louisiana.
The approval, which was apparently granted by the West Felician Parish Government Planning and Zoning Department on January 6, has been received positively by analysts, indicating a potentially significant expansion for the digital asset infrastructure provider.
Cantor analyst Brett Knoblauch suggested the company is in advanced talks with a major customer, known as a “hyperscaler,” whose name has not yet been disclosed. Knoblauch maintains an Overweight rating on the stock with a $35 price target (PT).
Similarly, Benchmark's Mark Palmer emphasized that this development brings Hut 8 a significant step closer to starting a “game-changing” ai data center complex. According to Palmer, the economics of the project could be very favorable for Hut 8, comparing it to a similar Core Scientific deal.
Investors are drawing parallels between the potential Hut 8 deal and Core Scientific's 12-year lease of data center capacity to CoreWeave.
Palmer noted: “Investors looking to evaluate Hut's potential from the first phase of the project have analyzed the economics of Core Scientific's 12-year deal to lease 500MW of data center capacity to ai hyperscaler CoreWeave, in which CORZ is set to generate revenue of ~$750 million and Ebitda of ~$600 million during each year of the deal.”
Reiterated a Buy rating on Hut 8 with an ambitious PT of $41.
Sentiment among analysts suggests that the deal with the hyperscaler could offer Hut 8 better economics per MW than Core Scientific achieved in its deal with CoreWeave.
This news represents a positive development for Hut 8, as it could significantly increase its revenue and Ebitda if the deal is finalized on favorable terms.
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