Using this approach, Compass Point identifies Applied Digital (APLD), TeraWulf (WULF), and Cipher Mining (CIFR) as exhibiting the most significant disconnect between their contracted business and current market valuations. Each company, the report argues, is undervalued due to the market assigning minimal value to unallocated AI capacity that could generate substantial rental income upon completion.
Core Scientific (CORZ) and Riot Platforms (RIOT) diverge in valuation rationale. Core Scientific’s existing contracts are already largely factored into its stock price, suggesting future growth hinges on securing new clients. Riot, however, commands a premium based on anticipated future performance, with investors valuing its Corsicana facility and broader AI development pipeline despite limited contracted capacity at present.
The report emphasizes that the sector’s next two years will mark a pivotal shift as companies transition from announcing AI infrastructure partnerships to delivering them. Once projects are operational and tenants begin paying rent, investors will gain clearer insights into the recurring cash flows these facilities can generate. Companies that execute effectively may see valuations align more closely with traditional income-producing infrastructure assets.
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