Bitcoin Mining Stocks CIFR Big Pump 209%: Rebound or Bubble?

Question

Speaking of CIFR (Cipher Mining), its rise this year is astonishing—up 209.5% since the beginning of the year, far exceeding the 19.5% growth of its peers. Even competitors CLSK (+19%), RIOT (+36.7%), and HUT (+80.3%) have been left behind.

Why is it so fierce?

The two core drivers: BTC price surge and Black Pearl mining farm going into production. In Q3, 629 Bitcoins were mined, generating revenue of 72 million USD (average BTC price of 114,400 USD).

The mining capacity is also expanding - the total computing power of the five major mining farms has increased from 423MW to 477MW, reaching 23.6 EH/s in Q3, with an electrical efficiency of 16.8 joules/TH, which is among the leading standards in the industry. The 150MW capacity of Black Pearl alone contributes 36% of the output, with an electrical efficiency reaching 13.9 joules/TH.

Easy Win Big Order: $850 Million Long-Term Contract

The most remarkable thing is the signing of the AI/HPC big contract:

AWS Big Order: 15-year commitment, Black Pearl 300MW capacity, contract value of 5.5 billion USD
Google+Fluidstack: 10-year 168MW AI host agreement with a base price of $3 billion, expandable to $7 billion (20-year term), Google has also acquired a 5.4% stake and guaranteed $1.4 billion in debt.

These two AI hosting contracts directly support approximately $8.5 billion in long-term cash flow. In other words, this is not just a mining company, but is gradually turning into a data center operator.

But the problem is quite significant.

Valuation Cap:

In December, the PS ratio reached 15.53X, which is 6 times the industry average of 2.54X.
The peer LSK is only 3.21X, RIOT is 7.04X, HUT is 9.53X
Zacks Rating F (seriously overvalued)

Profit Pressure: Q4 is expected to lose $0.10 per share, with a total annual loss of $0.37 per share. Although Q4 revenue is expected to double (up 98% year-on-year), the depreciation of new mining machines and rising electricity costs (due to increased network computing power) will compress profit margins.

Investment Advice

Zacks gave a #3 rating (hold/wait), which is very clear: don't rush to increase your position.

In the long term, the demand for AI data centers is real, and the large orders provide stable cash flow over time, which is indeed a positive factor. However, the current stock price has already reflected these expectations, and the valuation premium is too high. It would be more prudent to enter when the PS ratio returns to a more rational level (below 10X) or after the Q4 performance is confirmed.

The price fluctuations of BTC are also an invisible risk - when the coin price drops, these types of mining stocks can look very bad.