Iris Energy (NASDAQ:IREN) saw its stock decline 7% in pre-market trading after JPMorgan analyst Reginald Smith lowered his rating on the bitcoin mining infrastructure firm from Neutral to Underweight.
The downgrade carries a price target of $24.00, a steep fall from Thursday’s close of $46.29, reflecting JPMorgan’s cautious view on the company’s valuation in the high-performance computing sector.
Smith recognized Iris Energy as a major player in bitcoin mining, highlighting its favorable power contracts and efficient fleet operations. The company is actively expanding, with plans to roll out a Cloud Services business featuring around 23,300 GPUs, expected to be fully operational by Q1 2026. In addition, a 1.4 GW site is slated to come online in April 2026, and the firm is energizing its first 75 MW HPC data center, Horizon 1.
Despite these positives, Smith raised concerns that the current stock price may already reflect expectations of a colocation deal for a data center exceeding 1 GW—a record-scale agreement with potential capital expenditures above $10 billion. While acknowledging such expansion could happen over time, Smith warned that it presents more downside risk than upside for investors at current levels.
Iris Energy specializes in designing, owning, and operating data centers and energy infrastructure, primarily powered by renewable sources, supporting bitcoin mining and high-performance computing applications.
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