SKN | Hut 8 Price Targets Rise as Google-Backed AI Data Center Deal Reframes the Investment Case

Hut 8 is gaining renewed confidence from Wall Street after securing a long-term artificial intelligence infrastructure deal that analysts say materially reshapes the company’s risk profile and growth outlook. Shares of the bitcoin miner-turned-data-center operator rose sharply this week after Cantor Fitzgerald and Canaccord Genuity both lifted their price targets, citing the financial strength and strategic significance of the newly announced agreement.

At the center of the reassessment is a 15-year lease valued at $7 billion with AI infrastructure firm Fluidstack, covering 245 megawatts of power capacity at Hut 8’s River Bend data center in Louisiana. The agreement is financially backstopped by Google, which has committed to covering lease payments and operating costs, including energy, maintenance and taxes. Analysts view that support as a critical de-risking feature in a capital-intensive sector.

A Deal the Market Was Waiting For

Cantor Fitzgerald analyst Brett Knoblauch raised his price target on Hut 8 to $72 from $64, pointing to the finalized contract terms as stronger than initially anticipated. He highlighted the long duration of the agreement, a competitive power usage effectiveness ratio of 1.35, and projected net operating income of $6.9 billion over the base lease term. With three five-year renewal options, the total contract value could reach as high as $17.7 billion.

Knoblauch described the transaction as a turning point for Hut 8, arguing that the predictable, contracted cash flows from AI infrastructure meaningfully offset recent balance sheet pressure tied to bitcoin price fluctuations. His new target implies roughly 80% upside from the stock’s recent levels, reflecting a shift in how the firm is being valued by the market.

Google Backing Lowers Financial Risk

A key differentiator in the Fluidstack deal is Google’s role as financial guarantor. In an environment where AI data center demand is surging but financing conditions remain selective, the credit support from one of the world’s largest technology companies significantly reduces counterparty and execution risk.

That backing also positions Hut 8 more favorably with lenders, regulators and energy partners as it advances additional projects. The company currently has 900 megawatts under development and another 1,255 megawatts under exclusivity, signaling ambitions well beyond its original bitcoin mining footprint.

Analysts see this evolution as increasingly important as crypto miners diversify into AI and high-performance computing to smooth earnings volatility and attract a broader investor base.

Canaccord Sees Rising Asset Value

Canaccord Genuity also upgraded its outlook, raising its price target on Hut 8 to $62 from $54. The firm now values the River Bend site alone at $22 per share, up from a previous estimate of $14, reflecting updated pricing and transaction details disclosed by the company.

Canaccord’s analysts said their revised discounted cash flow model incorporates the improved visibility and stability provided by the Fluidstack contract, reinforcing the view that Hut 8’s infrastructure assets are worth materially more under an AI-focused strategy than under a bitcoin-only framework.

From Crypto Cycles to Infrastructure Scale

The timing of the deal is notable. Bitcoin’s recent pullback has weighed on mining economics and valuations across the sector, prompting investors to reward companies with diversified revenue streams and long-dated contracts. Hut 8’s shift toward AI infrastructure places it closer to digital real estate and energy-backed cash flow businesses than to purely speculative crypto plays.

Looking ahead, execution will remain the key variable. Successfully delivering capacity on time, securing permits, and expanding partnerships will determine whether Hut 8 can replicate the River Bend model at scale. If it does, analysts suggest the company could continue to re-rate as an infrastructure provider rather than a cyclical miner, potentially unlocking further upside.