Rosenblatt Sees 17% Upside with $124 Target, HPC Pipeline to Expand by 3Q 2026
HUT•Rosenblatt reiterated a Buy rating on Hut 8 with a $124 price target, forecasting AI/HPC hosting capacity to increase by 3Q 2026 via Beacon Point Phase 2 and a 330 MW River Bend expansion. The signed HPC leases cover 597 MW and $16.8 billion at $125/kW/month, financed by $7.5 billion of secured notes, with $1.3 billion liquidity.
1. Rosenblatt Reiteration and Upside
Rosenblatt reiterated its Buy rating on Hut 8 with a $124 price target, implying roughly 17% upside from current levels and affirming the target raised from $89 earlier this year. Analyst Chris Brendler highlighted management’s execution in scaling AI/HPC hosting and strong institutional demand.
2. Beacon Point Phase 2 and River Bend Expansion
Beacon Point Phase 2 exclusivity on about 500 MW of utility capacity is nearing expiration, triggering a right of first offer and a queue of tenants that could bring the site to a fully leased 1 GW campus. The River Bend expansion’s 330 MW power decision is expected in coming weeks to months, with energization targeted by late 2027 or early 2028.
3. Lease Agreements and Contracted Value
The two major HPC leases span 597 MW and carry $16.8 billion in contracted value at $125 per kW per month with 3% annual escalators on 15-year triple-net terms. This structure passes operating and upgrade costs to tenants, effectively yielding 100% gross margin at the lease level before corporate expenses.
4. Financing Structure and Liquidity
Project financing includes $3.25 billion of non-recourse senior notes for River Bend and $4.25 billion for Beacon Point, both priced at roughly a 6.2% coupon and 95% loan-to-cost. Hut 8 holds $1.3 billion in liquidity, has no parent-level recourse debt after its convertible note conversion, and requires no equity raise for its near-term pipeline.
