Bitdeer Technologies (NASDAQ:BTDR), a player in the Bitcoin mining sector, has caught the attention of investors, particularly those following the significant Bitcoin halving event. The company’s robust revenue in the last quarter and positive earnings per share (EPS) indicate a promising financial trajectory. Furthermore, the company’s strategic moves to optimize profits and expand operations are noteworthy – from launching its chip designed for mining to opening a cost-effective data center in Bhutan to leveraging immersion cooling technology in its Norway data center.
Its relatively low valuation suggests substantial growth potential, making it a compelling option for investors interested in Bitcoin miners.
Bitdeer’s Suite of Services
Bitdeer Technologies Group is a technology company that primarily focuses on blockchain and computing solutions. Its Bitcoin services range from hash rate sharing solutions, such as Cloud Hash Rate and Hash Rate Marketplace, to a one-stop mining machine hosting solution.
Additionally, Bitdeer Technologies Group also mines cryptocurrencies for its own use. The company runs several mining data centers to generate hash rates, overseeing all aspects of computing, from the procurement and transport logistics of equipment to designing and constructing data centers.
Bitdeer also bridges a gap in the chip market with its homegrown 4 nm SEALMINER chip. Marketed as a chip “for miners by miners,” this innovation boosts operational efficiency and minimizes supply chain disruption.
Analysis of Recent Financial Results
The company recently released its Q1 2024 financial results, highlighting a notable year-over-year growth. Total revenue for Q1 2024 was $119.5 million, an increase of almost 65% from $72.6 million in Q1 2023. This growth was primarily driven by a boost in revenue from the company’s self-mining business due to an increased self-mining hash rate, more Bitcoin production, and a higher average Bitcoin price during the period.
The company reported a net income of $0.6 million for Q1 2024, a significant turnaround from the net loss of $9.5 million witnessed in Q1 2023. This profitability was mainly due to a gross profit of $34.1 million from the company’s principal business and a gain of $3.1 million from the disposal of cryptocurrencies. However, this was somewhat offset by operating expenses of $37.8 million, including a $14.1 million one-off incremental development expense related to the SEAL01 chip.
Bitdeer also reported an adjusted EBITDA for Q1 2024 of $26.0 million, a 40% increase from $18.5 million in Q1 2023, and earnings per share (EPS) of $0.01, which fell short of analysts’ expectations of $0.14.
As of March 31, 2024, the company had cash and cash equivalents worth $118.5 million and total borrowings of $22.7 million, compared to US$144.7 million as of December 31, 2023. The decrease reflects capital used to construct mining data centers in Norway and Bhutan and prepay for the upcoming production of SEALMINER A1 rigs.
What Is the Price Target for BTDR Stock?
The stock has been trending, and is up 87% in the past 90 days. It trades in the upper half of its 52-week price range of $2.77 – $14.65 and shows positive price momentum by trading above its 20-day (10.13) and 50-day (8.69) moving averages. It trades at a discount, with a P/S ratio of 2.12x, sitting well below other Bitcoin miners and the Software Application industry average of 6.75x.
Analysts covering the company have been bullish on the stock. For instance, B. Riley analyst Lucas Pipes, a five-star analyst according to Tipranks ratings, recently raised the price target from $9 to $14 while maintaining a Buy rating on the shares, noting anticipated positive readings for the global hash rate and average bitcoin price in Q2.
Overall, Bitdeer Technologies is rated a Strong Buy based on six analysts’ recommendations and price targets recently assigned. The average price target for BTDR stock is $15.00, representing a potential upside of 41.91% from current levels.
Bottom Line on BTDR
Bitdeer Technologies has made significant strides as an emerging player in the Bitcoin mining industry. Its positive financial trajectory and innovative approach to optimizing profits and expanding operations make it an appealing investment option. The stock exhibits positive momentum while trading at a relative discount and looks to be a compelling option for investors interested in exposure to the space.
