KBW upgraded TeraWulf (WULF) to “outperform” from “market perform” and raised its price target to $24 from $9.50, highlighting the company’s pivot from bitcoin mining to AI and high-performance computing (HPC) leasing as a major growth catalyst.
The bank said investors are undervaluing the earnings potential from the shift. Analyst Stephen Glagola wrote Wednesday, “Investors underappreciate the magnitude of the BTC mining to HPC leasing mix shift in 2026–2027 and robust growth catalysts on 646 MW net of visible HPC leasing pipeline through 2027.”
Shares were modestly higher at $11.18 in early trading. The upgrade mirrors a broader trend of bitcoin miners repurposing data centers for AI and HPC infrastructure to boost profitability.
Glagola projected that TeraWulf’s current leases could deliver a 505% EBITDA CAGR from 2025 to 2027, supporting potential multiple expansion from the stock’s 13.8x EV/EBITDA valuation. HPC leasing is expected to generate roughly two-thirds of revenue in 2026 and the majority of contribution profit, with mining becoming largely negligible by 2027.
The report noted execution risks are lower than commonly assumed, citing secured financing, a proven delivery track record, and favorable debt markets. KBW added that recent share weakness reflects sector-wide selling rather than company-specific issues and expects discounts to narrow as lease revenues scale, with further upside from new HPC deals over the next year.
