IREN - Iris Energy downgraded at Cantor Fitzgerald citing 'uncertain path' ahead

Iris Energy ( NASDAQ: IREN ) stock dipped 5.7% in Monday morning trading as Cantor Fitzgerald analyst Josh Siegler downgraded shares of the eco-friendly bitcoin ( BTC-USD ) miner to Neutral from Overweight after it warned that some of its BTC mining machines don't cover debt financing costs .

Earlier this week, the company said that its lender delivered a "Purported Acceleration Notice" whereby Iris ( IREN ) allegedly failed to engage in good-faith restructuring talks. As a result, the notice claimed that Iris has defaulted on its scheduled principal payments on equipment financing loans, Siegler wrote in a note.

"We believe Iris is unlikely to reach a negotiation with the lenders by end-of-day 11/8/22," the agreed upon expiration between Iris ( IREN ) and its lender to defer payments for two weeks prior to that date, the analyst contended. "As a result, Iris may lose access to 3.6 EH/s of collateralized miners."

That makes it unlikely for the company to meet its annual hash rate targets, he added. "We believe the company no longer has line-of-sight into its 6.0 EH/s 2023E target, which was the crux of our Overweight thesis."

Perhaps another reason why IREN stock fell intraday was bitcoin's ( BTC-USD ) slump to below $20K .

Seeking Alpha contributor Mike Fay provided his assessment on Iris Energy's looming cash flow issue .

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