HUT stock rises after data center approval rumors By Investing.com

Investing.com – Hut 8 Corp (NASDAQ:HUT) shares rose 3% after rumors that the company received approval to build a 300-megawatt data center in Louisiana.

The approval, which was apparently granted by the West Felician Parish government’s Planning and Zoning Department on January 6, has been well received by analysts, signaling a potential major expansion for the digital asset infrastructure provider.

Cantor analyst Brett Knoblauch suggested that the company is in advanced discussions with a major customer, referred to as “superscale,” which has not yet been named. Knoblauch maintains an Overweight rating on the stock with a price target (PT) of $35.

Likewise, Benchmark’s Mark Palmer emphasized that this development brings Hut 8 an important step closer to starting a “game-changing” AI data center complex. According to Palmer, the project economics could be very favorable for Hut 8, compared to a similar deal for Core Scientific.

Investors are comparing the potential Hut 8 agreement to Core Scientific’s 12-year lease of data center capacity to CoreWeave.

“Investors seeking to evaluate Hut’s potential upside from the first phase of the project have looked at the economics of Core Scientific’s 12-year agreement to lease 500 megawatts of data center capacity to AI-powered CoreWeave, as CORZ prepares to generate revenues of approximately $750 million and EBITDA of approximately $600 million during each year of the transaction.

He reiterated a Buy rating on Hut 8 with an aspiration point of $41.

Sentiment among analysts is that the agreement with Superscale could deliver Hut 8 better economics per megawatt than that achieved by Core Scientific in its agreement with CoreWeave.

This news comes as a positive development for Hut 8, which could significantly increase its revenue and EBITDA if the deal is completed on favorable terms.

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