Major Bank Upgrades TeraWulf's Stock Rating and Offers Optimistic Cryptocurrency Mining Forecast

Major Bank Upgrades TeraWulf's Stock Rating

A prominent investment bank has announced an upgrade for TeraWulf's stock to "outperform," partly based on the company's development strategy. Keefe, Bruyette & Woods (KBW) has become more optimistic about the Bitcoin miner TeraWulf, highlighting an imminent shift in the company’s business mix that investors have yet to fully recognize. In a report released on Wednesday, KBW upgraded TeraWulf (WULF) from "market perform" to "outperform" and raised the price target for the company’s shares from $9.50 to $24. According to the bank, this reassessment is grounded in the belief that investors are "underestimating" the significant changes in the BTC mining lease mix towards high-performance computing (HPC) expected between 2026 and 2027, along with strong growth catalysts including a visible HPC leasing pipeline of 646MW by 2027.

As of the time of writing this news, TeraWulf shares were trading at $11.46, showing an increase of approximately 2.8% in the last 24 hours. Shares of MARA Holdings (MARA), another significant Bitcoin miner, saw a decrease of around 2.4% during the same period, while Riot Platforms (RIOT) experienced a slight rise of 0.8%.

In addition to BTC mining, KBW noted that TeraWulf's joint AI-HPC strategy has positively contributed to the company's operational profitability. "We estimate that existing leases generate a CAGR [compound annual growth rate] of +505% for EBITDA [Earnings Before Interest, Taxes, Depreciation, and Amortization] during the period from 2025 to 2027, alongside a positive inflection in ROIC [Return on Invested Capital] before taxes, allowing for a multiple expansion from the current 3.8x EV/EBITDA based on our peak estimate for 2027," KBW stated. They added, "We believe that the primary reason for the -34.6% decline in WULF from its 52-week high on October 28 was the broad and indiscriminate selling of Bitcoin mining stocks... against a backdrop of weakening Bitcoin mining fundamentals."

In October, TeraWulf reported a $3.2 billion deal as part of an expansion project for one of its data center facilities in New York. The company also secured three leasing agreements with AI infrastructure provider Fluidstack, totaling $6.7 billion.