Riot Platforms Inc. (NASDAQ:RIOT) shares are falling Tuesday even after Jefferies moved Riot to a Buy rating from Hold and lifted its target on the shares to $28, up from $13. Here’s what you should know.
- Riot Platforms stock is trading in a tight range. Where is RIOT stock headed?
Riot Platforms Stock Slips Despite Jefferies Upgrade
Last week’s earnings report brought news that an AI lab will rent Riot’s entire Corsicana campus for a decade and a half, and Jefferies analyst Jonathan Petersen built the upgrade around that deal.
Petersen sees the powered-land setup as safer for Riot, CNBC reported. Riot gets paid for the site while the tenant shoulders more of the construction and financing work. A standard data center costs $11 million to $15 million for each megawatt it builds, while this structure needs only about $6 million.
The fifteen-year agreement starts in September 2027 and pays an average 33% yield each year on half of what a typical project demands. Funding could come from project debt, or from the tenant, who would earn a discount on rent.
Petersen called the deal “a reset for the market.” Because the power is already in place and the tenant brings a modular build, capacity arrives sooner, Petersen wrote, and the tenant absorbs most of the delivery risk.
Riot Earnings Beat and Corsicana Lease Details
Analysts predicted a 27-cent shortfall per share for the third quarter, yet Riot earned 1 cent. Revenue came to $181.43 million, 12.86% above the $160.75 million forecast and 0.7% above last year’s $180.2 million. A cheaper bitcoin hurt mining. The coin averaged $70,855 versus $114,361 a year earlier, so mining sales fell by $44.8 million to $116.0 million, even though production rose 16%. Engineering revenue climbed past twice its year-ago level, to $47.0 million.
CEO Jason Les called the Corsicana lease “the largest lease in Riot’s history.” Over its initial 15 years, the 910-megawatt agreement should generate roughly $28 billion, around $1.8 billion a year.
RIOT Shares Are Dropping
RIOT Price Action: Riot shares were down 1.42% at 17.41 at the time of publication on Tuesday, according to Benzinga Pro.
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