Assessing the Valuation of IREN (NasdaqGS:IREN) After Recent Volatility and Strong Historic Gains

IREN (NasdaqGS:IREN) has had a mixed run recently, with its stock down nearly 5% on the day and a significant swing over the past month. Investors are curious about what might be driving these moves, especially given IREN’s notable long-term gains.

See our latest analysis for IREN.

The latest sharp pullback for IREN comes after massive gains over the past several months, with a 90-day share price return of 135.5% and a remarkable year-to-date move up 343.3%. While momentum has cooled significantly in recent weeks, the stock’s 1-year total shareholder return of 334.6% still puts it among the year’s top outperformers and shows how quickly sentiment can shift for fast-moving names like this.

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With IREN boasting exceptional recent returns but still trading more than 35% below analyst price targets, the real question is whether the current share price still offers value or if the market has already accounted for future growth in the price.

Most Popular Narrative: 52.8% Undervalued

According to the latest narrative by BlackGoat, the estimated fair value for IREN lands dramatically higher than the current share price. This perspective hinges on IREN's transition from a Bitcoin miner to an AI infrastructure leader, with recent milestones reshaping the company’s growth story.

“IREN surpassed its H1 2024 growth target, reaching 10 EH/s more than a month ahead of schedule. The company now aims to achieve 20 EH/s by September 30, 2024, and 30 EH/s by the end of the year. The image below highlights the ongoing construction at the Childress site, which is set to increase from 100 MW of operational power to 350 MW by December 31, 2024. Update (July 24, 2024): The Company announced it has reached 750MW of available power capacity at its Childress site.”

Read the complete narrative.

Want to know what ambitious expansion assumptions and fast-evolving revenue streams lie behind this lofty fair value? BlackGoat’s narrative teases aggressive scaling, unique energy leverage, and profit growth that could surprise even veteran bulls. Dive in to uncover the bold financial projections and strategic bets that aim to justify IREN’s huge discount to fair value.

Result: Fair Value of $98.21 (UNDERVALUED)

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

However, operational setbacks in ramping new capacity or continued shareholder dilution could quickly change the bullish outlook that investors are currently betting on.

Find out about the key risks to this IREN narrative.

Build Your Own IREN Narrative

If you see the numbers differently or want to dig deeper into IREN’s story, you can build your own perspective in just a few minutes by using Do it your way.

A great starting point for your IREN research is our analysis highlighting 4 key rewards and 4 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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