Bank of America Analyst: 'Bye Bye Bitcoin'

BofA Securities has initiated coverage of TeraWulf Inc. (NASDAQ: WULF) with a "Buy" rating and a $34 price target.

It is worth noting that the telecom analyst Michael Funk titled the research report, "Bye Bye Bitcoin. Hello AI data centers," to underscore the pivot toward the leading cryptocurrency.

Pivoting to AI

TeraWulf is currently repurposing its operations to focus on the high-performance computing (HPC) that are necessary for supporting massive AI workloads.

The firm aspires to reach between 1.8 and 3.0 gigawatts of critical IT load capacity by 2030.

The transition is considered to be a rather savvy move by analysts, given that there is growing demand for AI-ready data centers.

Recently, the company recently completed a landmark $3.2 billion high-yield bond sale to fund the expansion of its Lake Mariner campus in New York.

This transaction is the largest junk bond sale led by a single Wall Street institution in more than three decades. Notably, Alphabet’s Google has agreed to guarantee the debt once the facility is operational.

TeraWulf has also acquired a hyperscale site in Eastern Kentucky known as the Muskie Data Campus. This facility is expected to support over 1 gigawatt of capacity (deliveries are slated for the latter half of 2028).

The company is also working with Morgan Stanley and other institutions to explore the leveraged loan market to further fuel its AI infrastructure efforts.

Market performance

TeraWulf shares have seen an impressive 548% surge over the past year. They are currently changing hands near $28.

On top of BofA's bullish call, other firms have come up with their own bullish takes. Bernstein, for instance, initiated coverage with an "Outperform" rating.