Riot Platforms stock target raised to $20 on strong Bitcoin prices

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Riot Platforms stock target raised to $20 on strong Bitcoin prices
Credit: © Reuters.

On Tuesday, Singular Research adjusted its stock price target on shares of Riot Platforms (NASDAQ: RIOT ), a cryptocurrency mining company, raising it slightly to $20.00 from the previous $19.50.

The firm has maintained its Buy rating on the stock. This adjustment comes after Riot Platforms reported its fourth-quarter earnings for 2023, which presented a mix of outcomes.

The company's revenue for the quarter was $78.8 million, marking a 31% increase year-over-year from $60.1 million in the same period of the previous year. This rise was attributed to the surge in Bitcoin prices. The mining segment in particular saw significant growth, with revenue doubling to $60.0 million from $30.7 million in the fourth quarter of 2022.

Despite a decrease in the number of Bitcoin produced, from 1,712 to 1,630, the realized price of Bitcoin saw a substantial increase to $36,815, up 105% from the previous year's figure of $17,935.

Riot Platforms ended the quarter with a solid financial position, holding $597 million in cash and cash equivalents, along with approximately $311 million worth of Bitcoins. The company's growth trajectory appears to be on course as it aims to expand its hash rate capacity significantly.

By the fiscal year 2025, Riot Platforms expects to grow its hash rate capacity to 38.1 EH/s from the current capacity of 12.4 EH/s.

The firm's analyst pointed out that while the fourth-quarter revenues did not meet their estimates, the adjusted EBITDA surpassed expectations. The positive aspects of the report, particularly the robust growth in the mining segment revenue and the substantial increase in the realized price of Bitcoin, have led to the revised price target.

The new target suggests a potential capital appreciation of 15.1%, as the firm reiterates its confidence in Riot Platforms with a Buy rating.

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