RIOT Stock Gains After Jefferies Upgrade, JP Morgan Price Target Hike: Analysts See Favorable Economics In Corsicana Data Center Deal

JPMorgan’s new price target of $28 on Riot implies a potential upside of around 59% from Monday’s close.

• JPMorgan’s Richard Choe said Riot signed the Corsicana lease at “attractive risk-adjusted economics.” 
• The firm also pointed to the lease’s scale and structure as positive for Riot.
• Elsewhere in the sector, Citi cut its price target on TeraWulf, while Rosenblatt lowered its target on MARA Holdings.

Riot Platforms (RIOT) shares rose in early-morning trade on Tuesday after major updates from Jefferies and JPMorgan.

Jefferies upgraded RIOT to ‘Buy’ from ‘Hold’ and hiked its price target to $28 from $13, according to CNBC. Meanwhile,  JPMorgan analyst Richard Choe also lifted his price target to $28 from $22 and maintained an ‘Overweight’ rating, according to TheFly. 

Both analysts said Riot had secured the Corsicana lease at attractive risk-adjusted economics. “The powered land lease lets RIOT monetize the site with less execution and financing risk,” Jefferies wrote.

RIOT stock rose around 2% in pre-market trade and was among the top-trending tickers on Stocktwits at the time of writing. Retail sentiment around the former Bitcoin miner trended in ‘extremely bullish’ territory over the past day, alongside ‘extremely high’ levels of chatter. 

Why Are Analysts Bullish On RIOT Stock?

“We see RIOT’s Corsicana deal as a reset for the market,” Jefferies wrote in its note. “Pairing ready power with the tenant’s modular solution improves speed to market, while the powered-land structure reduces RIOT’s capital needs and shifts meaningful execution risk to the tenant.”

Meanwhile, JPMorgan noted that the agreement covers more computing capacity than investors had anticipated and said the 910 megawatts (MW) of IT capacity was “notably larger” than the 756 MW previously expected at the site.

The new $28 price target implies about 59% upside from Riot’s Monday closing price. It’s slightly below the average price target of $31.16 cited by Koyfin, implying potential upside of 76%. 

Of the 22 analysts covering Riot in Koyfin’s survey, 21 rate the stock ‘Strong Buy’ or ‘Buy’, while one has a ‘Hold’ rating. RIOT stock rose about 4% over the past year.

Riot’s $28B Corsicana Lease 

Riot announced last week that it will lease its entire Corsicana campus to an unnamed AI developer, which it described as “a leading Frontier AI Lab,” for 15 years. The tenant will pay about $28 billion over the lease’s initial term, making it the largest lease in Riot’s history.

The data center capacity is scheduled to come online in stages between September 2027 and July 2028. Including an earlier agreement with the same AI lab at Riot’s Rockdale campus in Texas, along with a contract with Advanced Micro Devices (AMD), the company now has about $38 billion in contracted data center revenue.

Riot estimates the project will cost about $6 million per MW, roughly half the cost of a typical high-end data center, according to the company. It also said it does not currently expect to issue new shares to finance the projects it has announced.

Riot built its business around mining Bitcoin (BTC), which gave it access to large sites with substantial electricity capacity. It is now seeking to monetize that infrastructure by leasing space and power to AI and data center operators.

Of late, the company has been increasingly selling Bitcoin from its balance sheet. Riot sold 8,962 BTC last week and had also sold about 4,300 BTC in October. CoinGecko data showed the company held approximately 2,418 BTC, worth about $180 million, at the time of writing.

MARA, WULF Stock See Price Target Cuts

Other bitcoin miners moving into AI didn’t fare as well with analysts on Tuesday. Citi lowered its price target on TeraWulf (WULF) to $24 from $31 while maintaining a ‘Buy’ rating. 

WULF stock traded flat in pre-market trade.  On Stocktwits, retail sentiment around TeraWulf remained in ‘bullish’ territory over the past day, accompanied by ‘high’ levels of chatter.

Meanwhile, Rosenblatt Securities analyst Chris Brendler cut his price target on MARA Holdings (MARA) to $11 from $15, while keeping a ‘Buy’ rating. Brendler said MARA’s third-quarter (Q3) results were more important for what they revealed about the company’s balance sheet than its mining performance. He cited market conditions for the price target cut. 

MARA stock fell about 1.6% in premarket trading. Retail sentiment around the company on Stocktwits shifted to ‘extremely bullish’ from ‘bullish’ over the past day, while chatter increased to ‘high’ from normal’ levels. 

For updates and corrections, email newsroom[at]stocktwits[dot]com.<