Bernstein expects the largest cryptocurrency to hit that level during the 2024-2027 cycle, the report said.
Bitcoin (BTC) is en route to hit $150 and crypto miners are evolving into industrial-scale enterprises, with North America gaining market share over China, broker Bernstein said in a research report Monday as it initiated coverage of the sector in the U.S.
Bernstein says it prefers Riot Platforms (RIOT), outperform rated with a $15.60 price target, and CleanSpark (CLSK), also outperform rated with a $5.30 price target.
These miners are “market share consolidators with strong operational edge (self-mining model), low cost of production (low power cost), high liquidity and unlevered balance sheets,” wrote analysts Gautam Chhugani and Mahika Sapra.
The broker has a market-perform rating on Marathon Digital (MARA) with an $8.30 price target. It notes that the company is the largest miner but with “sub-par costs (middle of cost curve) and debt, no operational edge (dependent on hosting partners).”
Riot and CleanSpark are “counter-cyclically investing in bitcoin self-mining capacity, unlike some miners who pivoted capacity to AI/high performance computing,” the report said, adding that it expects this “counter-cyclical BTC capacity to pay off” as the cycle turns.
“Bitcoin price cycles have followed 4 year patterns in sync with bitcoin halving,” and for the 2024-27 cycle the world’s largest cryptocurrency is expected to “rise to a cycle high of $150,000 by mid 2025,” Bernstein said.
The next bitcoin halving is expected in April 2024 and a “winning bitcoin miner is a high-beta way to gain exposure,” the report added.
