This is the Miner-ity Report, which I do once a month because they take a long time to prepare…
This lesson has been in the works for quite some time and you will see that there is a lot to it, as we had a big shakeup among the miners. We will review a new ratio and composite score with 42 financial ratios and over 8,000 numbers analyzed.
In addition, we are integrating HPC for the first time.
I decided to go back a full year and see exactly where we are because something very telling came out when we analyzed Bitcoin miners over the last year. The fact is that Bitcoin beat all of the Bitcoin miners' performance.
108% = BTC
91% = WULF
89% = CLSK
71% = BITF
62% = IREN
20% = MARA
I always stress Bitcoin mining is a cutthroat business. Never have more than 5% of your assets in miners. In the middle of the bull is not the best time to buy Bitcoin miners.
Let us check out the miners' relative value from Ecoinometrics. This displays the fair value price for all the different miners.
The easy takeaway from this slide is that only the WULF and IREN are currently at fair value. The rest of the miners are deeply under fair value.
I always analyze dilution. So much so that I had a team build me a dilution model that can analyze stock dilution from any window of time across many, many different assets.
Miners are now pivoting away from stock dilution to debt issuance: Bitdeer, Bitfarms, Cipher, Core Scientific, Marathon, Riot, and Terawulf. Nine out of the thirteen U.S.-listed companies raised a combined $1.25 billion through different offers. We know Marathon issued debt to buy Bitcoin. Others are issuing debt to buy rigs and get more modern.
In addition to listing out-performers, Bernstein is rating Marathon as a "market perform."
They also said CleanSpark receives very high marks for its energy efficiency and realized hash rate. We are going to break all that down in great detail shortly.
High Performance Compute (HPC) is the elephant in the room. These are the names entering the fray of HPC.
I think Peter Drucker said back in the '70s or '80s “a firm should always stick to its knitting”. The best firms are the ones that are hyper-focused on one thing, not spread across many different areas.
AI is all about power.
JP Morgan reiterated that this is a massive opportunity. There is an incredible need for energy to drive these HPC machines and that is what some of the Bitcoin miners are doing. They are pivoting over to that.
People think that HPC AI compute is going to take over the world. It
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