Analysts Expect 50% Rally in Bitcoin Mining Stock Northern Data

Northern Data, the Frankfurt-based Bitcoin firm, has been making key changes to its business model with its stock price likely to see a 50% price surge, as per the latest research report by investment bank Berenberg. Interestingly, this report comes after the fourth Bitcoin halving that happened just ten days back, reducing the miner rewards by a staggering 50%.

One of the major reasons behind Berenberg predicting a 50% surge in the Northern Data stock is because the Bitcoin miner has shifted focus to cloud solutions and data center infrastructure. As a result, Berenberg has initiated coverage of Northern Data’s stock with a Buy rating and target price of 39 euros per share. This shows a 53.2% upside from its current stock price.

Listed on the Frankfurt Stock Exchange, Northern Data operates under three major divisions: Peak Mining for Bitcoin mining, Ardent Data Centers for data center infrastructure, and Taiga Cloud certified as an “Elite” partner of NVIDIA Corp for cloud computing. As per the investment bank, the market is largely overlooking the potential growth of Taiga Cloud’s offerings. In a note to clients, Berenberg analysts Gerhard Orgonas and Jenna Xu said:

“We believe that the significant investments that Northern Data has made in the latest liquid-cooling mining technology and the expansion of the company at its existing North Dakota and new Texas sites should enable it to achieve high bitcoin production and mining profitability.”

Northern Data Shifting Gears

Northern Data’s pivot in its business model coincides with a pivotal moment in the cryptocurrency sector. A recent report from Coinshares forecasts a significant increase in production expenses for Bitcoin miners following the halving, with electricity and overall production costs nearly doubling.

In light of its recent acquisition of a data center in Pittsburgh, Northern Data is poised to undergo further development. Moreover, the company stands to capitalize on advancements made by its subsidiary, Ardent Data Centers, particularly in liquid-cooling technology tailored for its cryptocurrency mining endeavors.

On the other hand, Bitcoin miners are upgrading their infrastructure while embracing AI and gearing up for potential changes in the Bitcoin mining industry. Other big players such as Block Inc and Marathon Digital are making key changes to their operations.

Last week, Block Inc. said that their 3nm Bitcoin mining chips are production-ready. Through its Bitcoin mining chips, Block Inc. seeks to decentralize its mining operations. On the other hand, other players like Marathon Digital are also making strategic moves. They have also raised their hashrate target and doubled their mining capacity by the year-end.