Bernstein slashed its price targets on seven bitcoin miners by 35% to 54% Wednesday, citing tighter financing markets and uncertainty over Texas data center approvals after Democrats’ surprise win in the state’s governor’s race, CoinDesk reported. The cuts are to analysts’ price targets, not to the companies’ share prices.
The largest cut hit CleanSpark, whose target fell to $11 from $24, a drop of about 54%. Riot Platforms was cut to $18 from $35, IREN to $55 from $100, TeraWulf to $20 from $36, Core Scientific to $19 from $32, MARA Holdings to $10 from $17 and Cipher Mining to $15 from $23, according to the report.
A bitcoin mining facility (Marko Ahtisaari / CC BY 2.0).
The trigger was political. Democrat Gina Hinojosa defeated heavily favored Republican incumbent Greg Abbott in Texas, and she wants to pause new data center approvals until the state adopts rules protecting residents from higher electricity and water costs. No statewide ban has been enacted, and PIMCO’s Libby Cantrill said she expects “a lot more sand in the gears” rather than a stop to construction, according to a roundup of analyst reactions cited by CoinDesk.
The stakes are large because of how much is planned, not yet built: Goldman Sachs estimates Texas accounts for roughly a quarter of planned U.S. data center capacity, and that states likely to tighten rules make up about 45% of planned capacity. Bernstein senior analyst Gautam Chhugani wrote that more than half the power capacity held or planned by the miners-turned-AI-developers his firm covers is in Texas. “We would expect the data center pause to continue and any data center potential legislation to remain in gridlock,” he wrote, saying the firm now values miners’ AI colocation businesses at 12 times expected 2030 earnings, down from earlier assumptions.
The pain may not be evenly shared. Chhugani said miners that already hold approved power connections – IREN, Riot and Cipher have the most Texas exposure but also gigawatts of approved capacity – could benefit if new hookups become “scarce and valuable.” Morgan Stanley analysts led by Stephen Byrd flagged Cipher, MARA and Galaxy Digital as facing the most uncertainty, while calling TeraWulf, Hut 8 and Applied Digital better positioned, CoinDesk reported.
What it means for you: if you own these stocks, Wall Street is not saying the AI boom is over – Microsoft, Meta, Amazon and Google are still expected to spend about $740 billion on capital projects this year – it is saying the easy-money phase of converting bitcoin mines into AI data centers just got slower, pricier and more political, and the winners will be the miners that already locked in their power.
JBizNews Desk | New York
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