Wall Street Analyst Says Bitcoin Mining Equipment Maker Canaan Could Grow 5X

Benchmark analyst Mark Palmer suggests that Singapore-based Bitcoin mining chip and ASIC maker Canaan (CAN) has had a tough time but has the potential to grow fivefold.

Palmer began coverage of the ADR last Tuesday with a “buy” rating and a $3 price target. The stock closed yesterday at $0.62, down 72% since the start of the year.

Canaan's strategy includes developing ASIC chips and rigs for Bitcoin, as well as expanding into DIY mining, particularly in the U.S., Palmer said.

“CAN’s vertically integrated approach sets the company apart in the Bitcoin mining sector, while simultaneously generating revenue from both chip and rig sales and its own mining revenue,” he added.

He also emphasized that Canaan's entry into the home mining rig market has helped diversify the company's revenue.

The equipment manufacturer is also increasing its capacity for independent mining both in the US and internationally.

“While the company only generated 16.3% of its revenue from self-mining in 2024, it plans to increase its total computing power for these operations to 10 EH/s in North America and 15 EH/s globally by mid-2025,” Palmer added.

Canaan holds 1,408 bitcoins, which are currently valued at about $133 million, or nearly 70% of its current market cap, Palmer noted. That should support the company's valuation.

Read more: HPC-exposed Bitcoin miners underperform BTC for third straight month: JPMorgan

Source: cryptonews.net