H.C. Wainwright & Co. analyst Mike Colonnese has added Bitfarms stock to the firm’s top picks in the Bitcoin mining sector for 2025, citing strong operational improvements and a shift toward high-performance computing and AI infrastructure.

In a research note following Bitfarms’ Q4 2024 earnings report and conference call, Colonnese said the market is “significantly undervaluing” the company’s scaled-up mining operations and emerging AI strategy.

H.C. Wainwright reiterated its Buy rating on Bitfarms with a $3.50 per share price target, implying upside potential of more than three times from its current price of around $0.98.

Q4 recap

Bitfarms reported on March 27 Q4 2024 results. Revenue of $56.2 million was up 25% quarter-over-quarter and in line with analyst expectations. Self-mining revenue rose to $54.6 million, driven by higher average Bitcoin (BTC) prices and a 13% increase in deployed hashrate to 12.8 EH/s by year-end. Gross mining profit improved to $25.8 million with a 47.3% margin, up from 38.4% in the previous quarter.

While Bitcoin production dipped to 654 BTC due to rising network difficulty, the company still posted net income of $15.2 million, or $0.03 per share, a strong rebound from a net loss of $36.6 million in Q3. Adjusted EBITDA nearly tripled to $14.3 million.

Bitfarms has grown its hashrate capacity to 18.6 EH/s, nearly tripling its computing power from 6.5 EH/s at the end of 2023. Fleet upgrades have also improved overall efficiency by 45%, with hash costs now averaging around $20–$22 per petahash, notably below the current market hash prices of ~$50/PH.

Despite this, Bitfarms’ stock is down 57% since November, compared to a 7% decline in the Nasdaq index over the same time period. Colonnese sees the company’s current valuation of ~$25 million per deployed EH as a steep discount to peers, who trade closer to $85 million per EH.

Energy assets to power AI growth

Looking beyond mining, Bitfarms is positioning itself as a North American energy and compute company.

Management said on the call that there are no immediate plans to purchase more ASIC miners, and that future growth will focus on building energy infrastructure to support AI and HPC workloads.

This shift includes a recent acquisition of Stronghold assets and a sale of its Paraguay-based Yguazu site, increasing the U.S. share of its energy portfolio from 6% to 33%. Bitfarms now aims to grow to 1.4 GW of total energy capacity by 2028, with nearly 80% located in the U.S.

Colonnese noted that the HPC/AI opportunity is not yet reflected in current projections, and a potential partnership with a hyperscaler could provide meaningful upside.