Hut 8, TeraWulf, Applied Digital: UBS Sees at Least 30% Upside - Applied Digital (NASDAQ:APLD), Hut 8 (NA
UBS initiated coverage of five AI data center operators with Buy ratings, citing strong lease signings and tenant quality. The firms include Core Scientific (CORZ), Cipher Mining (CIFR), Applied Digital (APLD), TeraWulf (WULF), and Hut 8 (HUT). UBS estimates significant upside, with TeraWulf leading at 40% and Applied Digital at 33%. Key catalysts include new leases, tenant shifts, and potential REIT conversion.
How this was made
The 30-second read
Why it matters
The analyst report provides fresh valuation metrics and targets, likely prompting short‑term price moves for the covered stocks.
Market read
New analyst coverage with specific price targets can drive immediate trading activity in niche AI infrastructure stocks.
What to watch
Potential regulatory or environmental constraints on new data‑center builds could limit growth.
Background
UBS initiated coverage of five AI data‑center operators, assigning Buy ratings and price targets based on megawatt‑level valuation.
Ticker impact
UBS launched coverage with a Buy rating and set a $24 price target, implying ~26% upside for Core Scientific.
Potential 20‑30% rally if market follows UBS target.
UBS backs the rating with megawatt‑based valuation metrics.
UBS gave Cipher Mining a $23 price target, about 18% upside, citing 493 MW of leases.
Likely 10‑15% price gain on news.
Target is modest and based on lease pipeline.
UBS set a $38 target for Applied Digital, ~33% above current price, highlighting shift to investment‑grade tenants and possible REIT conversion.
Potential 25‑35% rally.
Target reflects significant tenant‑grade improvement.
UBS gave TeraWulf a $24 price target, ~40% upside, citing 840 MW of AI/HPC leases including a 20‑year Anthropic lease.
Possible 30‑45% price increase.
Large lease pipeline and high‑value megawatt metric.
UBS set a $143 target for Hut 8, ~35% upside, noting a 15‑year, $9.8 bn lease and upcoming energization at Beacon Point.
Potential 25‑35% rally.
Long‑term lease and upcoming capacity deliveries drive valuation.
Market effects
Highlights growing demand for AI data‑center capacity and may lift the broader AI‑infrastructure sector.
U.S. AI‑related REITs and data‑center operators could see increased investor interest.
Signals expanding AI compute demand worldwide, affecting global semiconductor and cloud providers.
Counterpoint
If lease pipelines stall or financing tightens, the upside may be overstated.
Key entities
- analystUBS
Investment bank launching coverage with Buy ratings.
