Benchmark reiterates a "Buy" rating on Hut 8 with a target price of $85, pointing out that as the company advances its AI data center strategy, management positions 2026 as the year of "execution and delivery."

Benchmark analyst Mark Palmer noted in the report that although the fourth-quarter results were affected by unrealized losses on Bitcoin, the more important point is that Hut 8 is steadily transforming into a "power-first digital infrastructure platform," gaining a clearer long-term contracted cash flow path.

Hut 8 posted a net loss of $301.8 million in the fourth quarter, mainly due to $401.9 million in unrealized losses on digital assets. With increased computing power revenue, revenue nearly tripled year-over-year to $88.5 million.

Palmer continues to view the 15-year, 245-megawatt IT lease agreement signed by River Bend and Fluidstack as the core investment logic. This agreement is financially supported by Google, and the approximately $7 billion base term agreement drives Hut 8's valuation closer to infrastructure multiples.

Benchmark's $85 target price is based on a sum-of-the-parts analysis, including River Bend leases, a probability-weighted valuation of an additional 1,000 megawatts under the right of first offer, the market value of Hut 8's 60% stake in American Bitcoin, and its Bitcoin holdings.