Assessing HIVE (TSXV:HIVE) Valuation After Recent 49.5% One-Month Share Price Surge

HIVE Digital Technologies (TSXV:HIVE) has caught attention as its share price jumped almost 50% over the past month, even as it experienced selling pressure during the previous week. Investors are looking into what might be fueling this momentum.

See our latest analysis for HIVE Digital Technologies.

HIVE Digital Technologies has shown some remarkable momentum lately, with a steep 49.5% one-month share price return following a surge in crypto sentiment, even after a sharp dip last week. Looking at the bigger picture, the stock’s long-term track record remains impressive. It boasts a total shareholder return of 231.2% over five years, demonstrating that momentum can build quickly when growth drivers come back into focus.

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With such strong upward moves and impressive returns, the big question now is whether HIVE shares are still undervalued, or if the recent rally means the market has already priced in future growth prospects.

Price-to-Earnings of 25.2x: Is it justified?

At a last close price of CA$7.70, HIVE Digital Technologies currently trades at a price-to-earnings (P/E) ratio of 25.2x, which stands out as notably lower than both its peer group and the broader Canadian Software industry.

The price-to-earnings ratio is a measure of how much investors are willing to pay for each dollar of a company’s earnings. For an emerging tech player like HIVE, this multiple reflects what the market is expecting in terms of future profit growth and earnings stability.

With the market often paying a much higher premium for software growth, HIVE’s 25.2x multiple is sharply below the industry average of 56.1x and its peer average of 54.7x. Its P/E ratio also sits under the estimated fair P/E ratio of 31x. This may indicate the market could be underestimating its future profitability and growth potential compared to industry peers and historical benchmarks.

Explore the SWS fair ratio for HIVE Digital Technologies

Result: Price-to-Earnings of 25.2x (UNDERVALUED)

However, volatility in crypto markets and fluctuations in tech valuations could quickly reverse HIVE’s recent gains if sentiment or fundamentals shift.

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

Build Your Own HIVE Digital Technologies Narrative

If you’d rather see the numbers for yourself or want to reach your own conclusions, you can quickly build your own analysis and narrative in just a few minutes. Do it your way

A great starting point for your HIVE Digital Technologies research is our analysis highlighting 4 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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