H.C. Wainwright reiterates Buy rating for Bitfarms (BITF) at a target price of $10

H.C Wainwright has reiterated a Buy rating for crypto mining company Bitfarms Ltd, with a price target of $10.00.

In a report highlighting Bitfarms’ as a company set to see further growth in 2022, analyst Kevin Dede says it’s a business model of“farming bit by bit.”

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In short, Wainwright sees the BITF stock hitting projected price targets for the year on the back of a solid end to the year as well as expansion efforts for the year. The analyst puts the bullish view on an “escalation of hash,” and the company’s data centers.

Revenue grew 33% in Q4 2021

Bitfarms’s financial results released Monday showed a 33% upside in revenues in Q4, 2021, with $59.6 million during the quarter beating the $44.8 million recorded during Q3, 2021.

Overall, revenue in 2021 grew 426% by Q4 and 388% for 2021 to $169 million compared to previous periods.

The firm’s full year-end 2021 results also showed that its end of 2021 Bitcoin hashrate stood at 2.1EH/s. But over the past few months, the hash rate has expanded to 2.7EH/s, up 23% year-to-date.

Bitfarms says the company’s total mining power should hit 3.0EH/s in the next 10 days. Projected targets for 2022 stand at 7.2EH/s, Wainwright wrote in a note.

‘A well-run, well diversified company’

Bitfarms’ strong performance in 2021 is also seen via the massive expansion of its mining facility. With 8 new sites set to go into operation later this year, the available power will jump from 100MW at the end of last year, to nearly 300MW.

Toronto-based Bitfarms Ltd. also has eyes on new “farms” in Argentina and Paraguay, a factor that sees Wainwright look at the miner as “a well-run, well-diversified” company. It does not “have all its eggs in one basket,” Dede added.

The miner will install 48,000 new MicroBT M30s mining rigs in 2022, with 27,500 going to Argentina and 20,500 to Quebec. And in terms of mining costs, the company is relatively lower at $38.50 per TH compared to market highs of $45-70 per TH.

“With the hash expansion ahead of network growth and more sites coming online as the year progresses, we see Bitfarms continuing to execute in support of our positive investment thesis.”

Wainwright, therefore, maintains the Buy rating at a $10.00 price target on a 3.4x price-to-sales ratio pegged on a revised revenue estimate of $235.2 million for FY22.

The analyst says the revision on revenue is based on assumptions of a lower Bitcoin (BTC) price. The previous sales forecast put revenues for 2022 at $244 million.

Bitfarms Ltd. (NASDAQ: BITF) shares jumped more than 10% on Tuesday after the company’s earnings results and 2022 projection.

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