Noble sees potential for AI infrastructure platform Bit Digital to double

Noble Capital Markets values Bit Digital, a small-cap company with a platform for digital assets and AI infrastructure, at more than double the current market price. The company builds data centers and equips them with Nvidia GPUs, as demand for such services continues to rise.

Noble values Bit Digital at $5.50 per share, 2.5 times the current market price. Yesterday, March 18, the stock closed at $2.26 per share, before adding another 1.3% in premarket trading today.

Noble released a new report on Bit Digital after the company unveiled its 2024 financial results on March 14, featuring a 141% year-over-year increase in revenue to $108.1 million and earnings per share of $0.19, versus a loss per share of $0.16 the previous year.

Bit Digital called 2024 a turning point for the company. Initially focused on crypto mining, it later embarked on a transformation at the end of 2023. The company decided to build its own data center and acquired Nvidia GPUs to sell cloud-based computing power to third parties. One of its clients is Boosteroid, which Bit Digital describes as “the world’s third-largest cloud gaming provider.” In October 2024, Bit Digital acquired Canada-based data center builder Enovum for about CAD62.8 million (approximately $46 million). The company’s high-performance computing business now operates under the WhiteFiber brand.

Noble notes that Bit Digital has a strong balance sheet, allowing it to invest in more GPUs. As of December 31, Bit Digital had $98.9 million in cash equivalents, with total liquidity — including digital assets — at around $260.7 million, according to its financials. The company’s management highlighted surging demand for Nvidia’s B200 GPUs, while the emergence of China’s DeepSeek AI has also fueled interest in Nvidia’s H100 and H200 GPUs, which were designed specifically for the Chinese market in order to comply with U.S. export restrictions.

While bitcoin mining remained the company’s primary revenue source in 2024, its share is shrinking, Bit Digital reports. Last year, which marked the first full year for its infrastructure business, mining’s share of total revenue dropped from almost 100% to 54%. Moreover, it fell to 40% in the fourth quarter.

According to MarketWatch, Noble’s target price for Bit Digital is the lowest on Wall Street. All six analysts covering the name have “buy” recommendations. Their average target price is $6.92 per share, three times the last closing price.