B. Riley kicked off coverage on Bit Digital (BTBT) with a Buy rating and $6 per share price target, which caused shares to rally at the time of writing. The investment firm pointed to the company’s big transformation over the past year, as Bit Digital has expanded into the AI space in order to diversify its business beyond just Bitcoin (BTC-USD) mining.
About a year ago, Bit Digital entered the AI market to grow its revenue. Since then, it has hit a $50M revenue run-rate in its GPU segment, and analyst Nick Giles expects that number to double to $100M in the next two quarters, which he expects to be driven just from its current customer base. This shift has been a key part of the company’s strategy to reduce its reliance on volatile crypto markets.
Giles also pointed out that Bit Digital’s digital assets segment still benefits from potential rises in BTC and Ethereum (ETH-USD) prices. However, he thinks the company could get a higher valuation if it spins off this part of the business in the future. Right now, he believes the market isn’t fully appreciating how Bit Digital is shifting toward more steady and diverse revenue sources.
Is BTBT Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on BTBT stock based on four Buys assigned in the past three months, as indicated by the graphic below. After an 8% year-to-date decline in its share price, the average BTBT price target of $6.13 per share implies 55.2% upside potential.
