CLSK - CleanSpark Walks A Fine Line With Bitcoin

2024-07-01 07:08:36 ET

Summary

• CleanSpark is expanding its BTC mining operations with new facilities in Wyoming and Georgia, aiming to reach 31.6exahash/second.
• CleanSpark is utilizing their balance sheet to acquire additional data centers and engage in M&A for inorganic growth.
• CleanSpark's shares trade directionally with BTC and may realize strength as BTC is more widely held by retail investors.

CleanSpark ( CLSK ) has found itself in a unique position when compared to other BTC mining operators as the firm remains flush with cash, bitcoin holdings, and a growing operation with the goal of reaching 50exahash/second in eFY25. As the firm operates in a more challenging BTC mining environment post-BTC halving, management has been opportunistic in acquiring competing mining operations to expand and benefit from the challenging environment. In addition to this, CleanSpark is in the process of building out an additional 75MW of capacity in Wyoming for an additional 4.2exahash/second to be added to the fleet for a total of 20.9exahash/second. Inclusive of their 5 new facilities in Georgia, the firm will have a total of 31.6exahash/second. Given CleanSpark’s expanding holdings of BTC and new operating facilities, I reiterate my BUY rating for CLSK shares with a price target of $28.67/share at 18x price/BV of BTC holdings....

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