• Morgan Stanley recently initiated coverage on TeraWulf, emphasizing its transition from primarily bitcoin mining to building environmentally focused, industrial-scale data center infrastructure for artificial intelligence and high-performance computing, supported by new brownfield site acquisitions and project-level financing.
• The firm’s shift to treating its power-rich mining sites as contracted data center assets, backed by large partners such as Google, reframes TeraWulf as an infrastructure operator with an emphasis on power expertise and long-duration hosting agreements.
• We’ll now explore how Morgan Stanley’s focus on TeraWulf’s AI-oriented data center build-out could reshape the company’s existing investment narrative.

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TeraWulf Investment Narrative Recap

To own TeraWulf today, you need to believe its evolution from a leveraged bitcoin miner into a contracted, power-focused AI and HPC data center operator can offset execution, capital intensity, and customer concentration risks. Morgan Stanley’s new coverage and focus on long-duration, infrastructure-like cash flows may reinforce the current bull case, but the most important near term catalyst remains evidence that early AI hosting deals scale smoothly, while the biggest risk is that heavy capex outpaces dependable cash generation.

The most relevant recent development is TeraWulf’s long-term HPC joint venture with Fluidstack for a 168 MW AI campus in Texas, backed in part by Google’s lease support. This arrangement sits at the center of the AI hosting thesis that Morgan Stanley is highlighting, and it directly ties upcoming milestones like build-out progress and tenant ramp to whether TeraWulf can convert its growing power footprint into the kind of contracted, higher-margin revenue that could eventually lessen its reliance on volatile mining income.

Yet behind the AI growth story, investors should be aware that rising capex and dependence on a few large counterparties could still...

TeraWulf's narrative projects $920.8 million revenue and $157.9 million earnings by 2028. This requires 85.6% yearly revenue growth and an earnings increase of about $289.6 million from -$131.7 million today.

Uncover how TeraWulf's forecasts yield a $22.10 fair value, a 38% upside to its current price.

Exploring Other Perspectives

By contrast, the most optimistic analysts lean into the idea that long dated AI hosting deals could push revenue toward about US$1.4 billion and earnings above US$600 million, showing just how far opinions and risk tolerance can differ as you weigh concentrated tenants against that kind of upside.

Explore 9 other fair value estimates on TeraWulf - why the stock might be worth less than half the current price!

Build Your Own TeraWulf Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your TeraWulf research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.
• Our free TeraWulf research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate TeraWulf's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.