IREN (NasdaqGS:IREN): Evaluating Valuation After $9.7B Microsoft Deal and AI Infrastructure Pivot

IREN (NasdaqGS:IREN) is getting a lot of attention following its strategic pivot from bitcoin mining to powering AI cloud and GPU infrastructure. The $9.7 billion Microsoft contract signals how seriously the company is leaning into this transition.

See our latest analysis for IREN.

After rocketing higher earlier in the year, IREN’s share price has experienced some dramatic swings, especially after locking in that $9.7 billion Microsoft deal and announcing ambitious GPU expansion plans. Setting short-term volatility aside, the momentum story is still hard to ignore. The stock boasts a year-to-date share price return of 363.6% and a three-year total shareholder return exceeding 3,000%, signaling that long-range belief in IREN’s AI pivot is alive and well despite recent uncertainty.

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But after such relentless growth and ambitious expansion targets, the question remains: has all this excitement already been priced into IREN’s stock, or could current volatility offer investors a compelling entry point for future upside?

Most Popular Narrative: 49% Undervalued

According to BlackGoat’s widely-read narrative, IREN’s calculated fair value is significantly above the recent closing price. With substantial upside projected, this narrative sets the stage for bold debate around what is really driving IREN’s massive premium.

"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."

Read the complete narrative.

Want to know the ambitious forecasts fueling this big price gap? The real twist lies in a few surprisingly aggressive growth assumptions and future profit margins. Which projections are powering this high fair value? Unlock the full narrative for answers that defy expectations.

Result: Fair Value of $94.84 (UNDERVALUED)

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

However, regulatory hurdles or unforeseen execution delays could quickly dampen sentiment and cause analysts to question the sustainability of IREN’s turnaround story.

Find out about the key risks to this IREN narrative.

Build Your Own IREN Narrative

Prefer a hands-on approach or see the story differently? Dive into the numbers and craft your personal thesis in just a few minutes: Do it your way

A great starting point for your IREN research is our analysis highlighting 3 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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