Assessing HIVE Digital Technologies (TSXV:HIVE) Valuation Following Major Bitcoin Production Surge and Facility Expansion

HIVE Digital Technologies (TSXV:HIVE) just delivered September production numbers that will catch investors’ attention, posting an 8% monthly jump in Bitcoin mined and a 138% boost compared to last year.

See our latest analysis for HIVE Digital Technologies.

That operational momentum seems to be echoing in the share price, too. HIVE’s 1-month share price return is a remarkable 84.8%, with the 3-month number at 223%. Its total return over the last year has more than doubled, sitting at 110.9%. While much of this surge has unfolded in recent weeks, investors are clearly responding to HIVE's improved efficiency and production milestones as signs of growing long-term potential rather than just short-term hype.

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With such rapid growth and operational outperformance, is HIVE Digital Technologies still trading at a bargain, or have investors already priced in the next wave of expansion and future profitability?

Price-to-Earnings of 31.7: Is it justified?

HIVE Digital Technologies trades at a Price-to-Earnings ratio of 31.7, which sits well below both its industry and peer group averages. This makes it look attractively valued compared to the broader Canadian software sector.

The Price-to-Earnings (P/E) ratio compares a company’s current share price to its earnings per share. For a tech-savvy, growth-oriented company like HIVE, the P/E is a snapshot of how much investors are willing to pay per dollar of current profit, often factoring in expectations for future growth and profitability.

With HIVE’s P/E notably undercutting the Software industry average of 56.1 and the peer average of 63.6, the market appears to place less of a growth premium on the company compared to its rivals. This could signal overlooked upside if HIVE continues to outperform, or it could mean investors require further evidence that recent profit gains are sustainable. The current P/E sits just above the estimated fair ratio of 31.5, which suggests the market valuation is close to what a fair pricing model might indicate.

Explore the SWS fair ratio for HIVE Digital Technologies

Result: Price-to-Earnings of 31.7 (ABOUT RIGHT)

However, slower net income growth or shifts in Bitcoin prices could quickly alter HIVE’s outlook. This makes continued outperformance less certain.

Find out about the key risks to this HIVE Digital Technologies narrative.

Build Your Own HIVE Digital Technologies Narrative

If you have your own view or want to dig deeper into the numbers, it only takes a few minutes to build your own perspective and approach. Do it your way

A great starting point for your HIVE Digital Technologies research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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