IREN Limited (NASDAQ:IREN) shares reached a new all-time high on Friday after the stock climbed more than 21% this week driven by retail investor optimism.
- IREN stock is climbing. See the real-time price action here.
Last week, investor and co-founder of Tiny Capital Andrew Wilkinson called IREN a "Picasso at a garage sale," implying that the stock was significantly undervalued despite its 400% gains this year.
He shared his thesis on IREN in a post on X.
Bull Case
Wilkinson believes IREN's shift to a cloud services provider and massive power capacity could make it the largest AI datacenter company in the world.
He pointed to IREN's 2,910 MW of power, more than the Hoover Dam, potentially generating $4.4 billion annual profit.
At typical datacenter multiples of 25x, Wilkinson said this implies an enterprise value of $110 billion, or $83 billion after debt. IREN could capture even more value with its plans to become its own Cloud Services Provider like AWS or Google Cloud.
IREN's assets were built cheaply, using Bitcoin (CRYPTO: BTC) profits, about $4 million per MW, versus the $10 million per MW industry standard.
Bear Case
Wilkinson's bear case includes an unlikely decline in AI demand and execution risk if IREN fails to build high-quality data centers.
Competitors could scoop up major customers faster, but IREN is already signing deals (e.g., Fluidstack) and gaining Nvidia's support, according to Wilkinson's theory.
Price Targets
Wilkinson concluded that IREN is still a "Picasso at a garage sale" even at current prices.
He maintained that IREN stock's intrinsic value is at least $106 in the bear case and as high as $300 if AI demand continues growing.
IREN stock hit a new all-time high of $52.19 on Friday and was trading at $50.08 at the time of publication, according to Benzinga Pro.
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