Analysts Bullish on RIOT Despite Recent Price Drop
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 04 2024
0mins
Should l Buy RIOT?
Source: investopedia.com
Riot Platforms Inc. saw its stock drop by 5.69%, hitting a 5-day low amid a broader market decline, with the Nasdaq-100 down 1.00% and the S&P 500 down 0.49%.
Despite the drop, analysts from Chardan initiated 'Buy' ratings on RIOT, reflecting confidence in the company's shift towards high-performance computing. This comes as part of a broader trend in the industry, where mining firms are transitioning to long-term data center leases, anticipating significant growth in demand for computing as AI applications expand. Retail sentiment on Stocktwits remained bullish, indicating optimism about future growth prospects.
The implications of this analyst upgrade suggest that while RIOT's stock is currently facing downward pressure, the long-term outlook remains positive as the company adapts to changing market conditions and technological advancements.
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Analyst Views on RIOT
Wall Street analysts forecast RIOT stock price to rise
9 Analyst Rating
9 Buy
0 Hold
0 Sell
Strong Buy
Current: 17.240
Low
20.00
Averages
27.00
High
42.00
Current: 17.240
Low
20.00
Averages
27.00
High
42.00
About RIOT
Riot Platforms, Inc. is an integrated digital infrastructure company. The Company is principally engaged in developing and optimizing its power assets. Its segments include Bitcoin Mining and Engineering. The Bitcoin Mining segment is engaged in Bitcoin mining activities. The Engineering segment designs and manufacturers power distribution equipment and custom engineered electrical products. This segment also provides electricity distribution product design, manufacturing, and installation services primarily focused on large-scale commercial and governmental customers and serves clients across a range of markets including data center, power generation, utility, water, industrial, and alternative energy. It is also focused on developing a portion of its power capacity for artificial intelligence (AI)/ high-performance computing (HPC) uses. The Company provides electrical engineering services to a customer base of energy developers and data center operators.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Riot Platforms Q1 2026 Earnings Call Insights
- Revenue and Loss Overview: Riot reported total revenue of $167 million in Q1 2026, despite facing a GAAP net loss of $500 million primarily due to a $326.7 million non-cash mark-to-market loss on Bitcoin holdings, indicating vulnerability amid market volatility.
- Data Center Expansion Plans: AMD officially exercised a 25-megawatt expansion option, bringing the total contracted capacity at the Rockdale facility to 50 megawatts, with an anticipated annualized operating lease revenue run rate of $55.6 million by 2027, highlighting the company's strategic shift towards data center operations.
- New Business Line Performance: The newly added Data Center segment exited the quarter with 5 megawatts of critical IT capacity fully online, generating $33.2 million in total revenue, including $900,000 in operating lease revenue, showcasing initial success and strong market demand for the new business line.
- Financing Strategy and Risks: Management emphasized that no common equity was issued during the quarter while continuing to pursue non-dilutive funding sources, despite facing risks from equipment supply chain delays, indicating a cautious and forward-looking approach to financing structures.
See More
Riot Platforms Stock Rises 7.31% Following Q1 Results
- Stock Surge: Riot Platforms' stock closed up 7.31% at $18.50 on Friday, primarily driven by positive Q1 results, indicating the company's potential in Bitcoin mining and data center operations.
- Volume Spike: Trading volume reached 32.6 million shares, approximately 74% above the three-month average, reflecting strong investor interest in the company's future growth, particularly in its data center expansion.
- Capacity Delivery Progress: Riot delivered its first 5 MW of capacity to AMD earlier this year and is on track to deliver another 20 MW by May 2026, demonstrating tangible progress in its transition to an AI data center operator.
- Long-Term Growth Potential: Management anticipates that Riot's total lease capacity could grow to 200 MW, with a long-term goal of reaching 1.2 GW, showcasing the company's strategic ambition in its shift from Bitcoin mining to AI data centers.
See More
U.S. Stocks Close: S&P 500 Hits All-Time High
- S&P 500 Strong Performance: The S&P 500 index rose by 0.29%, reaching an all-time high, driven by Apple's forecast of stronger-than-expected Q2 revenue, which boosted market sentiment and indicated increased investor confidence in tech stocks.
- Atlassian Stock Surge: Atlassian's stock soared over 29% after reporting Q3 revenue of $1.79 billion, exceeding the market expectation of $1.69 billion, highlighting a robust recovery in the software sector that may attract more investor interest.
- Oil Price Volatility Impacting Markets: WTI crude oil prices fell more than 3%, easing inflation concerns, although trade tensions resurfaced with President Trump's threat to raise tariffs on EU auto imports, potentially negatively affecting market sentiment.
- Economic Data Influencing Stocks: The April ISM manufacturing index remained unchanged at 52.7, below the expected 53.2, indicating signs of economic slowdown, despite the majority of companies reporting Q1 earnings that exceeded expectations, leaving the overall market facing uncertainty.
See More
Riot Platforms Q1 Earnings Beat Expectations, Lifts Bitcoin-Linked Stocks
- Earnings Highlights: Riot Platforms reported Q1 revenue of $167.2 million, a 3.6% year-over-year increase, exceeding analyst expectations by $37.2 million, although GAAP EPS was -$1.44, below the expected -$0.83, primarily due to a $326.7 million non-cash Bitcoin revaluation loss.
- Operational Efficiency Gains: Despite a Bitcoin mining cost of $44,600 per asset, Riot managed to lower costs through $21 million in power credits, while mining 1,473 Bitcoins in Q1, a 3.7% year-over-year decline, with holdings down 18% to 15,680 Bitcoins.
- Data Center Revenue Growth: Riot's data center revenue reached $33.2 million in Q1, showcasing the company's success in diversifying its business, particularly after AMD doubled its capacity at the Rockdale site to 50 MW, further strengthening its AI narrative.
- Analyst Sentiment Optimistic: Analysts rate Riot Platforms as a “Buy” with a score of 4.00, while Wall Street analysts maintain a stronger “Strong Buy” rating of 4.57, reflecting market confidence in Riot and setting a positive tone for Strategy's upcoming earnings report.
See More
Riot Platforms Q1 Results Highlight AMD Partnership Potential
- Sales Growth: Riot Platforms reported a 3.6% year-over-year increase in Q1 sales to $167.2 million, despite a decline in Bitcoin production from 1,530 to 1,473 coins, demonstrating resilience in a challenging market.
- AI Computing Demand: The strong demand for AI computing capacity led to a surge in other revenues from $18.5 million to $55.3 million, indicating significant progress in diversifying revenue streams for Riot.
- AMD Partnership Expansion: Riot's collaboration with AMD is yielding revenue, as AMD has doubled its contracted capacity at Riot's Rockdale, Texas facility from 25 megawatts to 50 megawatts, enhancing Riot's competitive position in the market.
- Business Model Transformation: Management highlighted that Riot is transitioning from solely Bitcoin mining to becoming an active data center operator, achieving contracted lease revenue from an investment-grade tenant for the first time, showcasing the company's strategic diversification and future growth potential.
See More
Mixed Performance in US Indices as Apple’s Strong Earnings Boost Market
- Apple's Strong Earnings: Apple Inc. (AAPL) reported Q2 revenue of $111.18 billion, exceeding the consensus of $109.66 billion, and forecasted Q3 revenue growth of 14% to 17%, significantly above the expected 9.1%, which propelled the Dow Jones Industrial Average up over 4%.
- Software Stocks Surge: Atlassian (TEAM) posted Q3 revenue of $1.79 billion, surpassing the consensus of $1.69 billion, leading to a stock price increase of over 20%, which not only boosted the software sector but also enhanced investor confidence in tech stocks.
- Oil Price Volatility: WTI crude oil prices fell more than 3% due to developments in the US-Iran agreement, temporarily easing inflation concerns and contributing to stock market gains, highlighting the energy market's influence on the overall economy.
- Weak Manufacturing Data: The April ISM manufacturing index remained unchanged at 52.7, below the expected 53.2, while the prices paid sub-index rose to a four-year high of 84.6, indicating increasing price pressures that could impact Federal Reserve policy decisions.
See More
Riot Platforms Q1 2026 Earnings Call Insights
- Revenue and Loss Overview: Riot reported total revenue of $167 million in Q1 2026, despite facing a GAAP net loss of $500 million primarily due to a $326.7 million non-cash mark-to-market loss on Bitcoin holdings, indicating vulnerability amid market volatility.
- Data Center Expansion Plans: AMD officially exercised a 25-megawatt expansion option, bringing the total contracted capacity at the Rockdale facility to 50 megawatts, with an anticipated annualized operating lease revenue run rate of $55.6 million by 2027, highlighting the company's strategic shift towards data center operations.
- New Business Line Performance: The newly added Data Center segment exited the quarter with 5 megawatts of critical IT capacity fully online, generating $33.2 million in total revenue, including $900,000 in operating lease revenue, showcasing initial success and strong market demand for the new business line.
- Financing Strategy and Risks: Management emphasized that no common equity was issued during the quarter while continuing to pursue non-dilutive funding sources, despite facing risks from equipment supply chain delays, indicating a cautious and forward-looking approach to financing structures.
See More
Riot Platforms Stock Rises 7.31% Following Q1 Results
- Stock Surge: Riot Platforms' stock closed up 7.31% at $18.50 on Friday, primarily driven by positive Q1 results, indicating the company's potential in Bitcoin mining and data center operations.
- Volume Spike: Trading volume reached 32.6 million shares, approximately 74% above the three-month average, reflecting strong investor interest in the company's future growth, particularly in its data center expansion.
- Capacity Delivery Progress: Riot delivered its first 5 MW of capacity to AMD earlier this year and is on track to deliver another 20 MW by May 2026, demonstrating tangible progress in its transition to an AI data center operator.
- Long-Term Growth Potential: Management anticipates that Riot's total lease capacity could grow to 200 MW, with a long-term goal of reaching 1.2 GW, showcasing the company's strategic ambition in its shift from Bitcoin mining to AI data centers.
See More
U.S. Stocks Close: S&P 500 Hits All-Time High
- S&P 500 Strong Performance: The S&P 500 index rose by 0.29%, reaching an all-time high, driven by Apple's forecast of stronger-than-expected Q2 revenue, which boosted market sentiment and indicated increased investor confidence in tech stocks.
- Atlassian Stock Surge: Atlassian's stock soared over 29% after reporting Q3 revenue of $1.79 billion, exceeding the market expectation of $1.69 billion, highlighting a robust recovery in the software sector that may attract more investor interest.
- Oil Price Volatility Impacting Markets: WTI crude oil prices fell more than 3%, easing inflation concerns, although trade tensions resurfaced with President Trump's threat to raise tariffs on EU auto imports, potentially negatively affecting market sentiment.
- Economic Data Influencing Stocks: The April ISM manufacturing index remained unchanged at 52.7, below the expected 53.2, indicating signs of economic slowdown, despite the majority of companies reporting Q1 earnings that exceeded expectations, leaving the overall market facing uncertainty.
See More
Riot Platforms Q1 Earnings Beat Expectations, Lifts Bitcoin-Linked Stocks
- Earnings Highlights: Riot Platforms reported Q1 revenue of $167.2 million, a 3.6% year-over-year increase, exceeding analyst expectations by $37.2 million, although GAAP EPS was -$1.44, below the expected -$0.83, primarily due to a $326.7 million non-cash Bitcoin revaluation loss.
- Operational Efficiency Gains: Despite a Bitcoin mining cost of $44,600 per asset, Riot managed to lower costs through $21 million in power credits, while mining 1,473 Bitcoins in Q1, a 3.7% year-over-year decline, with holdings down 18% to 15,680 Bitcoins.
- Data Center Revenue Growth: Riot's data center revenue reached $33.2 million in Q1, showcasing the company's success in diversifying its business, particularly after AMD doubled its capacity at the Rockdale site to 50 MW, further strengthening its AI narrative.
- Analyst Sentiment Optimistic: Analysts rate Riot Platforms as a “Buy” with a score of 4.00, while Wall Street analysts maintain a stronger “Strong Buy” rating of 4.57, reflecting market confidence in Riot and setting a positive tone for Strategy's upcoming earnings report.
See More
Riot Platforms Q1 Results Highlight AMD Partnership Potential
- Sales Growth: Riot Platforms reported a 3.6% year-over-year increase in Q1 sales to $167.2 million, despite a decline in Bitcoin production from 1,530 to 1,473 coins, demonstrating resilience in a challenging market.
- AI Computing Demand: The strong demand for AI computing capacity led to a surge in other revenues from $18.5 million to $55.3 million, indicating significant progress in diversifying revenue streams for Riot.
- AMD Partnership Expansion: Riot's collaboration with AMD is yielding revenue, as AMD has doubled its contracted capacity at Riot's Rockdale, Texas facility from 25 megawatts to 50 megawatts, enhancing Riot's competitive position in the market.
- Business Model Transformation: Management highlighted that Riot is transitioning from solely Bitcoin mining to becoming an active data center operator, achieving contracted lease revenue from an investment-grade tenant for the first time, showcasing the company's strategic diversification and future growth potential.
See More
Mixed Performance in US Indices as Apple’s Strong Earnings Boost Market
- Apple's Strong Earnings: Apple Inc. (AAPL) reported Q2 revenue of $111.18 billion, exceeding the consensus of $109.66 billion, and forecasted Q3 revenue growth of 14% to 17%, significantly above the expected 9.1%, which propelled the Dow Jones Industrial Average up over 4%.
- Software Stocks Surge: Atlassian (TEAM) posted Q3 revenue of $1.79 billion, surpassing the consensus of $1.69 billion, leading to a stock price increase of over 20%, which not only boosted the software sector but also enhanced investor confidence in tech stocks.
- Oil Price Volatility: WTI crude oil prices fell more than 3% due to developments in the US-Iran agreement, temporarily easing inflation concerns and contributing to stock market gains, highlighting the energy market's influence on the overall economy.
- Weak Manufacturing Data: The April ISM manufacturing index remained unchanged at 52.7, below the expected 53.2, while the prices paid sub-index rose to a four-year high of 84.6, indicating increasing price pressures that could impact Federal Reserve policy decisions.
See More
