Riot Platforms Stock Initiated With Bullish Price Target

Riot Platforms' stock (NASDAQ: RIOT) gained new analyst coverage in the guise of Macquarie, who put RIOT straight in with a $15 price target, and an Outperform rating. With shares currently changing hands for $7.45 in the pre-market session, the target set reflects a potential 2x.

Whilst analyst forecasts are notoriously changeable, the bullish sentiment will be well received by longer term holders who have seen the stock price drop 51.14% over the past 12 months.

Supporting commentary surrounding the ability Riot has to “drive massive scale” in it's field is a good indication of the belief in the operational formula being built at the firm. The company is a pure-play, vertically operated bitcoin miner, whose sites offer the scale required to develop high yielding operational efficiencies.

The company focuses on large-scale mining operations and data center hosting, primarily in Texas and owns both the mining operations and the infrastructure needed to support them. This enables the company to maintain a competitive edge in Bitcoin production.

With the 52 week range for the stock being a high of $18.75 against a low of $6.36, the current price action has been playing out far closer to the low end than the bulls would like. The coverage from Macquarie then that initiates towards the upper end of this range sees the company returning to favour.

Of the analysts holding coverage on Riot, the consensus of $17.36 is formed from a low of $11 against the high of $22. This reflects quite the bullish picture, but operationally the firm will want to deliver some improving metrics having missed on EPS and revenues last time out.

To shore up one pending issue, the firm recently resolved a dispute with Bitfarms, another Bitcoin mining company out of Canada that Riot had bid $950 million in order to acquire. This offer was firmly rejected, and the ensuing conflict has now come to a head. The settlement ends Riot's acquisition attempt and solidifies its stake in Bitfarms at 19.9%, allowing Riot to maintain influence without taking full control​.

Amy Freedman, a former investment banker who has helped companies with corporate governance matters, will replace Andrés Finkielsztain on the Bitfarms board, and was one of three nominees pushed by Riot.