Assessing IREN (NasdaqGS:IREN)’s Valuation After Its $9.7b Microsoft AI Deal and $3.6b Capital Raise

IREN (NasdaqGS:IREN) just pulled off a rare combo, landing a $9.7 billion multi year AI cloud deal with Microsoft and backing it up with a $3.6 billion capital raise to fund massive GPU and data center expansion.

See our latest analysis for IREN.

The share price has been choppy around the latest capital raise and Microsoft deal, with a 7 day share price return of minus 21.88 percent but a year to date share price return of 249.81 percent and a three year total shareholder return of 2,513.57 percent still signaling powerful, if volatile, momentum behind the pivot to AI infrastructure.

If IREN's run has you thinking about what else could benefit from the AI build out, it might be worth exploring other high growth tech and AI names through high growth tech and AI stocks.

Wall Street still sees upside with price targets more than double the current share price, even after a 47 percent slide from the highs. But with expectations already sky high, is this a genuine dip to buy, or is the market simply pulling forward years of AI growth?

Most Popular Narrative Narrative: 61.4% Undervalued

Against the last close of $36.59, the most followed narrative pins IREN’s fair value dramatically higher, framing the Microsoft deal as a structural turning point.

The "Earnings Flywheel" is now primed with the Microsoft contract, providing a safety net of committed revenue. The risk profile has fundamentally changed, it is no longer about "going to zero", it is about pricing power. The uncertainty isn't whether IREN will survive, but whether the next 2GW can be sold at the same premium economics as the first 200MW. For now, the contracts are signed, the funding is secured, and the execution clock is ticking.

Read the complete narrative.

Want to see how contracted revenue, aggressive growth projections and future profit margins all combine into that lofty upside target? The full narrative unpacks every assumption.

Result: Fair Value of $94.84 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, that bullish setup still depends on flawless execution and resilient AI demand. Any construction delays or hyperscaler budget cuts could quickly undermine the thesis.

Find out about the key risks to this IREN narrative.

Build Your Own IREN Narrative

If this perspective does not sit right with you, or you would rather dig into the numbers yourself, you can build a custom narrative in under three minutes: Do it your way.

A great starting point for your IREN research is our analysis highlighting 4 key rewards and 3 important warning signs that could impact your investment decision.

Looking for more investment ideas?

Before you move on, consider identifying your next potential opportunity by putting the Simply Wall Street Screener to work so you are not relying on IREN alone.

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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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