Investment banking firm Keefe, Bruyette & Woods is increasingly bullish on Bitcoin miner Terrawolf, citing impending changes to the company’s business mix that investors have not yet fully factored in.
KBW upgraded TerraWolf (WULF) from “market perform” to “outperform” and raised their price target for the company from $9.50 to $24 in a report on Wednesday.
According to the bank, the revaluation is based on investors “underestimating the magnitude of the lease mix shift from BTC mining to HPC (high performance computing) leasing from 2026 to 2027 and the robust growth driver with a total of 646MW excluding the visible HPC leasing pipeline through 2027.”
At the time of writing, TeraWulf stock is trading at $11.46, up about 2.8% over the past 24 hours. The stock price of MARA Holdings (MARA), another important Bitcoin (BTC) miner, fell about 2.4% over the same period, while Riot Platforms (RIOT) rose 0.8%.
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KBW said that in addition to BTC mining, TeraWulf’s joint AI-HPC strategy is boosting the company’s operating profit.
“We estimate that the existing leases are expected to generate a positive change in EBITDA (earnings before interest, taxes, depreciation, and amortization) CAGR of +505% and pre-tax ROIC (return on invested capital) from 2025 to 2027, enabling us to further expand our current EV/EBITDA multiple of 3.8x, which is our best estimate as of 2027,” KBW said. addition:
“We believe that the -34.6% decline in WULF from its 52-week high on October 28th was primarily due to the near-indiscriminate sell-off of Bitcoin mining stocks in response to weakening Bitcoin mining fundamentals (…).”
In October, TeraWulf reported a $3.2 billion deal as part of a data center expansion at one of its New York facilities. The company also signed three leases with AI infrastructure provider Fluidstack, worth a total of $6.7 billion.
As of this writing, BTC price is $87,625, up 3% in the past 30 days, according to Nansen data.
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