We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The Zacks Consensus Estimate for revenues is currently pegged at $114.04 million, suggesting growth of 150.53% from the year-ago quarter’s reported figure.
The consensus mark for earnings is pegged at 4 cents per share, unchanged over the past 30 days. CLSK reported a loss of 5 cents in the year-ago quarter.
Let’s see how things are shaping up prior to this announcement.
Estimate Revision Steady
Image Source: Zacks Investment Research
Factors to Note
CleanSpark’s use of renewable energy and its aggressive expansion strategy have been the major growth drivers.
In the second quarter of fiscal 2024, CLSK reported revenues of $111.8 million, up a whopping 163% year over year and 52% sequentially.
CLSK has been one of the highest producers of Bitcoin year to date, primarily due to an impressive 63% surge in operating capacity. At the end of the fiscal second quarter, CleanSpark had 134,000 machines compared with 68,000 machines at the end of the year-ago period.
At the end of the fiscal second quarter, CleanSpark’s total capacity was more than 17 exahash per second (EH/s) distributed across eight owned and operated data centers in Georgia and Mississippi, and co-location facilities in upstate New York.
Lower costs of operation bode well for CleanSpark post-Bitcoin halving, which means that the reward for Bitcoin mining is cut in half. Halving takes place every four years, and the policy helps Bitcoin counteract inflation by maintaining scarcity. However, halving hurts profitability by compressing margins. CleanSpark’s low-cost operational base makes it immune to this headwind.
CLSK Stock Outperforms Sector
CLSK shares have returned 12% year to date, outperforming its closest mining peers, Riot Platforms (RIOT - Free Report) and Marathon Digital (MARA - Free Report) . RIOT has dropped 46.3%, whereas MARA has declined 28.9% over the same timeframe.
YTD Performance
Image Source: Zacks Investment Research
CLSK has a Growth Style Score of F, which makes the stock unattractive for growth-oriented investors. A Value Style Score of F indicates a stretched valuation at this moment.
CleanSpark stock is trading at a premium with a trailing 12-month EV/Sales of 8.65X compared with the S&P 500’s 4.72X.
EV/Sales Ratio (TTM)
Image Source: Zacks Investment Research
CLSK’s shares are trading below the 50-day moving average, indicating a bearish trend.
CLSK Trades Below 50-Day SMA
Image Source: Zacks Investment Research
Facility Expansion Aids CleanSpark Stock’s Prospects
CLSK continues to acquire mining facilities with an agreement to buy two bitcoin mining locations in Wyoming, offering 75 MW of available power. The sites are expected to add 4.2 EH/s once fully operational. In June, it inked an agreement to acquire five turnkey bitcoin mining facilities in rural Georgia. The sites offer more than 3.7 EH/s upon the full installation of the latest generation S21 pro miners.
CleanSpark benefits from its focus on lowering costs and improving efficiency. The company has upgraded its machine fleet through the addition of S21 Pro miners, which significantly enhanced its mining capabilities by reducing costs per terahash. The upgrade induced a 17% increase in total purchased hashrate, adding 3.4 exahash per second.
CLSK is expanding its footprint with the acquisition of GRIID Infrastructure for an enterprise value of $155 million. CleanSpark expects to add more than 400 MW in Tennessee over the next two years, making its total announced, planned and owned capacity at more than 1 GW infrastructure.
The rise in capacity will help CLSK catch up fast with its competitors RIOT, MARA and Core Scientific (CORZ - Free Report) . At the end of June, CleanSpark hit an operational hashrate of 20 EH/s with 152,505 machines deployed. In comparison, Riot Platforms, Marathon Digital and Core Scientific hit hashrates of 22.0 EH/s, 26.3 EH/s and 24.6 EH/s, respectively.
The company plans to achieve the hashrate target of 32 EH/s at the end of this year and 50 EH/s in 2025, driven by facility expansion. CLSK’s strong liquidity position, with $681 million in cash and Bitcoin (6,591 as of Jun 30) holdings, is also noteworthy.
Conclusion
CleanSpark’s aggressive facility expansion strategy, as well as its low-cost operational base, makes it an attractive stock for long-term investors.
CleanSpark’s growth prospect is significantly dependent on Bitcoin’s price movement, which is expected to remain volatile in the near term. This makes CLSK a risky bet.
Image: Bigstock
Should You Buy, Sell, or Hold CleanSpark (CLSK) Before Q3 Earnings?
CleanSpark (CLSK - Free Report) is scheduled to report its third-quarter fiscal 2024 results on Aug 8.
The Zacks Consensus Estimate for revenues is currently pegged at $114.04 million, suggesting growth of 150.53% from the year-ago quarter’s reported figure.
The consensus mark for earnings is pegged at 4 cents per share, unchanged over the past 30 days. CLSK reported a loss of 5 cents in the year-ago quarter.
Let’s see how things are shaping up prior to this announcement.
Estimate Revision Steady
Image Source: Zacks Investment Research
Factors to Note
CleanSpark’s use of renewable energy and its aggressive expansion strategy have been the major growth drivers.
In the second quarter of fiscal 2024, CLSK reported revenues of $111.8 million, up a whopping 163% year over year and 52% sequentially.
CLSK has been one of the highest producers of Bitcoin year to date, primarily due to an impressive 63% surge in operating capacity. At the end of the fiscal second quarter, CleanSpark had 134,000 machines compared with 68,000 machines at the end of the year-ago period.
At the end of the fiscal second quarter, CleanSpark’s total capacity was more than 17 exahash per second (EH/s) distributed across eight owned and operated data centers in Georgia and Mississippi, and co-location facilities in upstate New York.
Lower costs of operation bode well for CleanSpark post-Bitcoin halving, which means that the reward for Bitcoin mining is cut in half. Halving takes place every four years, and the policy helps Bitcoin counteract inflation by maintaining scarcity. However, halving hurts profitability by compressing margins. CleanSpark’s low-cost operational base makes it immune to this headwind.
CLSK Stock Outperforms Sector
CLSK shares have returned 12% year to date, outperforming its closest mining peers, Riot Platforms (RIOT - Free Report) and Marathon Digital (MARA - Free Report) . RIOT has dropped 46.3%, whereas MARA has declined 28.9% over the same timeframe.
YTD Performance
Image Source: Zacks Investment Research
CLSK has a Growth Style Score of F, which makes the stock unattractive for growth-oriented investors. A Value Style Score of F indicates a stretched valuation at this moment.
CleanSpark stock is trading at a premium with a trailing 12-month EV/Sales of 8.65X compared with the S&P 500’s 4.72X.
EV/Sales Ratio (TTM)
Image Source: Zacks Investment Research
CLSK’s shares are trading below the 50-day moving average, indicating a bearish trend.
CLSK Trades Below 50-Day SMA
Image Source: Zacks Investment Research
Facility Expansion Aids CleanSpark Stock’s Prospects
CLSK continues to acquire mining facilities with an agreement to buy two bitcoin mining locations in Wyoming, offering 75 MW of available power. The sites are expected to add 4.2 EH/s once fully operational. In June, it inked an agreement to acquire five turnkey bitcoin mining facilities in rural Georgia. The sites offer more than 3.7 EH/s upon the full installation of the latest generation S21 pro miners.
CleanSpark benefits from its focus on lowering costs and improving efficiency. The company has upgraded its machine fleet through the addition of S21 Pro miners, which significantly enhanced its mining capabilities by reducing costs per terahash. The upgrade induced a 17% increase in total purchased hashrate, adding 3.4 exahash per second.
CLSK is expanding its footprint with the acquisition of GRIID Infrastructure for an enterprise value of $155 million. CleanSpark expects to add more than 400 MW in Tennessee over the next two years, making its total announced, planned and owned capacity at more than 1 GW infrastructure.
The rise in capacity will help CLSK catch up fast with its competitors RIOT, MARA and Core Scientific (CORZ - Free Report) . At the end of June, CleanSpark hit an operational hashrate of 20 EH/s with 152,505 machines deployed. In comparison, Riot Platforms, Marathon Digital and Core Scientific hit hashrates of 22.0 EH/s, 26.3 EH/s and 24.6 EH/s, respectively.
The company plans to achieve the hashrate target of 32 EH/s at the end of this year and 50 EH/s in 2025, driven by facility expansion. CLSK’s strong liquidity position, with $681 million in cash and Bitcoin (6,591 as of Jun 30) holdings, is also noteworthy.
Conclusion
CleanSpark’s aggressive facility expansion strategy, as well as its low-cost operational base, makes it an attractive stock for long-term investors.
CleanSpark’s growth prospect is significantly dependent on Bitcoin’s price movement, which is expected to remain volatile in the near term. This makes CLSK a risky bet.
CleanSpark currently has a Zacks Rank #3 (Hold), suggesting that it may be wise to wait for more favorable entry points in the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.