On Friday, B.Riley adjusted its stock price target for Iris Energy Ltd. (NASDAQ: NASDAQ:IREN), a cryptocurrency mining company, reducing it from $17.00 to $12.00. The firm retained its Buy rating on the stock. The revision in the price target is attributed to an increase in the number of shares outstanding. The company, known for its Bitcoin mining operations, reported production of 245 BTC in August, marking a 10% month-over-month increase.
Iris Energy achieved an operating hash rate of 16.0 EH/s in August and is aiming to reach 30 EH/s by the fourth quarter of 2024. The firm has the capability to scale its hash rate up to 50 EH/s leveraging its existing S21 Pro miner purchase options. The company's utilization rate was noted to be 82% for the month.
The company is on schedule with its expansion plans, aiming to hit 20 EH/s in the third quarter of 2024 and 30 EH/s in the fourth quarter. This progression follows a substantial month-over-month deployment increase of 52% in the hash rate during August. Moreover, Iris Energy's AI Cloud services revenue increased by 2% month-over-month to $15.5 million in August, serving six end customers in the reserved and on-demand market.
Iris Energy is also preparing to introduce the Childress GPU pilot for AI services later in the second half of the year. The company had previously reported its financial results for the fiscal year ended June 30, 2024, on August 28. B.Riley has updated its estimates for the company, revising the adjusted EBITDA projections for the first quarter of FY2025 from $21.8 million to $18.1 million, and for the full year FY2025 from $178.8 million to $154.0 million.
Investors are currently anticipating further updates on the high-performance computing (HPC) monetization opportunities process, which Iris Energy initiated in July 2024.
InvestingPro Insights
As Iris Energy Ltd. (NASDAQ: IREN) continues to make strides in its cryptocurrency mining operations, recent data from InvestingPro provides additional context for investors. With a market capitalization of $1.4 billion, the company has demonstrated a remarkable revenue growth of nearly 150% in the last twelve months as of Q4 2024. This aligns with the InvestingPro Tip highlighting analysts' anticipation of sales growth in the current year. Iris Energy's gross profit margin stands at an impressive 88.24%, which supports the company's ability to maintain high profitability on its revenue.
Despite the lack of dividends and a negative P/E ratio, the company has shown a significant return of 66.82% over the last year. This level of performance is in line with another InvestingPro Tip pointing out the company's substantial return over the past week. While the stock trades with high price volatility, investors may find potential in the company's growth trajectory and operational expansion plans.
For those interested in deeper analysis, InvestingPro offers additional tips on Iris Energy, including insights on cash reserves, profitability forecasts, and valuation multiples. As of now, there are 17 more InvestingPro Tips available for Iris Energy, which can be found on their dedicated InvestingPro page.
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