Hut 8 shares drew renewed attention after Benchmark raised its price target on the company to $85, citing a newly announced AI data center agreement that significantly improves the visibility and durability of future cash flows. The analyst upgrade follows Hut 8’s evolution from a bitcoin miner into a broader digital infrastructure developer, with growing exposure to AI focused compute capacity. Benchmark highlighted that the structure of the deal shifts operating cost risk away from Hut 8 and toward the tenant, while locking in long dated revenue streams backed by strong counterparties. This approach is viewed as a meaningful change in the quality of earnings compared to traditional mining driven revenue, especially as investors reassess infrastructure plays linked to artificial intelligence demand.
At the center of the upgrade is a 15 year triple net lease covering the first phase of development at Hut 8’s River Bend campus in Louisiana, representing 245 megawatts of IT capacity. The agreement carries an estimated base value of about $7 billion and includes a 3 percent annual rent escalator, providing predictable growth in cash flows over time. Benchmark also pointed to the presence of a payment backstop from Google as a key factor reducing counterparty risk, strengthening confidence in the contracted revenue. Importantly, Hut 8 was able to secure the agreement without issuing equity or warrants, preserving shareholder value while maintaining full economic ownership of the underlying asset.
Beyond the initial phase, Benchmark emphasized the optionality embedded in the agreement, which allows Hut 8 to scale significantly without committing upfront capital. This includes rights tied to as much as 1,000 additional megawatts at River Bend and a broader framework to develop more than 1 gigawatt across the company’s wider pipeline. The revised $85 price target reflects a sum of the parts valuation that also accounts for Hut 8’s stake in American Bitcoin and its existing bitcoin holdings. Shares were trading just under $50, near recent highs, as the market digests the growing role of AI infrastructure in reshaping crypto linked equities.
