JPMorgan Turns Bullish on Bitcoin Miners Pivoting to HPC — Cipher and CleanSpark Lead the Charge
Financial giant JPMorgan has significantly adjusted its outlook on several U.S.-listed bitcoin mining companies, highlighting a strategic shift towards high-performance computing (HPC) services that is fundamentally reshaping business models and offering clearer long-term revenue streams for operators.
The bank’s latest research note sheds light on a growing trend among digital asset miners to diversify their operations beyond pure bitcoin mining, leveraging their extensive infrastructure for a broader range of data center services.
Cipher Mining Upgraded as Contracted HPC Capacity Surges
Leading the upgrades, Cipher Mining (CIFR) saw its rating elevated to “Overweight” from “Neutral,” with a corresponding increase in its price target from $12 to $18. The market responded positively, with CIFR shares climbing 5.65% in early trading to reach $14.95, reflecting investor optimism following JPMorgan‘s endorsement.
Cipher Mining share price (Source: Google Finance)
Analysts pointed to Cipher’s recent share price pullback from its highs as a compelling entry point, particularly given its substantial approximately 600 megawatts (MW) of contracted capacity already secured with major tenants such as Amazon Web Services (AWS) and Fluidstack.
This established capacity, dedicated to services beyond cryptocurrency mining, exemplifies the strategic pivot gaining traction in the sector.
Also read: Bernstein Lifts Targets as Bitcoin Miners Pivot Toward AI Data Centers
CleanSpark (CLSK) also received a significant boost, with JPMorgan upgrading its rating to “Overweight” from “Neutral.” CleanSpark’s stock reacted favorably, rising 5.55% in pre-market trading to $10.27.
CleanSpark share price (Source: Google Finance)
The upgrade for CleanSpark is largely attributed to its promising entry into the HPC space, with an estimated 200 MW of potential HPC capacity identified at its newly acquired Texas site. This development positions CleanSpark to capitalize on the increasing demand for high-density computing infrastructure.
The broader analysis from JPMorgan emphasized the accelerating transition of bitcoin miners from singular bitcoin exposure to becoming hybrid HPC operators.
Sector Capacity Set to Hit 1.7 GW by 2026
The bank highlighted that IREN and Cipher Mining alone have collectively secured over $19 billion in contracted revenue across approximately 600 MW of critical IT capacity since late September. This substantial figure serves as a concrete indicator of the industry’s rapid diversification into the data center and HPC market. JPMorgan now projects that the critical IT capacity across its covered mining companies could reach an impressive 1.7 gigawatts (GW) by late 2026, with Cipher and Iris Energy expected to be primary drivers of this growth.
While the focus was largely on the positive implications of the HPC shift, JPMorgan also made adjustments to other prominent miners. IREN saw its price objective raised to $39 from $28, though the bank maintained its “Underweight” rating on the company.
Conversely, Marathon Digital Holdings (MARA) and Riot Platforms (RIOT), both previously rated “Overweight,” experienced price target reductions. Marathon’s target was trimmed to $13 from $20, while Riot’s was adjusted to $17 from $19.
Those revisions were explicitly attributed to the lower prevailing price of bitcoin, rather than any changes in their operational strategy or HPC potential. Despite the lowered targets, both stocks saw modest gains in trading, with MARA rising 2.8% to $10.35 and RIOT gaining 1.8% to $12.94 at publication time.
JPMorgan Updates Valuation Models for a New HPC Era
JPMorgan’s analysts have also refined their valuation methodologies to better reflect the evolving business models. The bank now assigns a higher equity value per megawatt, ranging from $8 million to $17 million for colocation services and up to $19 million for integrated cloud solutions.
That upward revision in valuation metrics is driven by several factors, including lower discount rates and enhanced cash-flow visibility stemming from long-term HPC contracts. The report suggests that this re-evaluation reflects a more mature and diversified revenue outlook for companies successfully executing the HPC pivot.
Looking ahead, JPMorgan’s analysis indicates that Riot Platforms and CleanSpark show the most significant upside potential under a full conversion to HPC operations. However, Cipher Mining is recognized for maintaining the largest long-term optionality, particularly when considering its unapproved future capacity that could further expand its HPC footprint.
