Hut 8 (NASDAQ:HUT) Shares Gap Down - Should You Sell?

Key Points

• Hut 8 shares fell 3.8%, opening at $80.88 versus a prior close of $85.24, and remained below both its 50-day and 200-day moving averages.
• Analysts remain broadly bullish, with an average rating of “Buy” and an average price target of $145.77, despite the company’s quarterly EPS and revenue falling short of estimates.
• Institutional ownership increased, including a roughly $1.09 billion new stake by BlackRock, while company insiders recently sold shares; insiders own 10.40% of Hut 8.

Hut 8 Corp. (NASDAQ:HUT - Get Free Report) shares gapped down prior to trading on Tuesday. The stock had previously closed at $85.24, but opened at $80.88. Hut 8 shares last traded at $81.7360, with a volume of 951,099 shares.

Analyst Ratings Changes

A number of analysts have recently commented on the stock. Benchmark boosted their target price on shares of Hut 8 from $165.00 to $195.00 and gave the company a "buy" rating in a report on Wednesday, July 22nd. Loop Capital set a $226.00 target price on shares of Hut 8 in a research report on Monday, June 22nd. Rosenblatt Securities reiterated a "buy" rating and issued a $124.00 price target on shares of Hut 8 in a research note on Wednesday, August 5th. B. Riley Financial increased their price target on shares of Hut 8 from $130.00 to $163.00 and gave the stock a "buy" rating in a research note on Monday, August 3rd. Finally, Needham & Company LLC lowered their price target on shares of Hut 8 from $145.00 to $138.00 and set a "buy" rating for the company in a research report on Wednesday, August 5th. Four research analysts have rated the stock with a Strong Buy rating, eighteen have given a Buy rating, one has given a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat, the company has an average rating of "Buy" and an average price target of $145.77.

Hut 8 Stock Down 3.8%

The stock has a 50 day simple moving average of $89.53 and a 200-day simple moving average of $93.81. The firm has a market cap of $10.11 billion, a PE ratio of -15.07 and a beta of 4.62. The company has a debt-to-equity ratio of 4.22, a current ratio of 19.35 and a quick ratio of 19.35.

Hut 8 (NASDAQ:HUT - Get Free Report) last released its earnings results on Wednesday, August 5th. The company reported ($1.27) EPS for the quarter, missing the consensus estimate of ($0.55) by ($0.72). Hut 8 had a negative return on equity of 0.97% and a negative net margin of 188.59%. The company had revenue of $74.93 million during the quarter, compared to the consensus estimate of $79.37 million. During the same period last year, the firm posted $1.18 earnings per share. Sell-side analysts predict that Hut 8 Corp. will post -2.98 EPS for the current fiscal year.

Insider Activity

In related news, CFO Sean Glennan sold 6,445 shares of the company's stock in a transaction dated Monday, August 24th. The shares were sold at an average price of $78.76, for a total value of $507,608.20. Following the transaction, the chief financial officer owned 17,978 shares in the company, valued at $1,415,947.28. The trade was a 26.39% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, Director Mayo Shattuck, III sold 20,000 shares of the company's stock in a transaction dated Thursday, September 24th. The stock was sold at an average price of $100.00, for a total transaction of $2,000,000.00. Following the completion of the transaction, the director owned 89,408 shares in the company, valued at approximately $8,940,800. The trade was a 18.28% decrease in their position. The disclosure for this sale is available in the SEC filing. 10.40% of the stock is owned by insiders.

Institutional Investors Weigh In On Hut 8

Several institutional investors and hedge funds have recently made changes to their positions in the company. BlackRock Inc. bought a new stake in Hut 8 in the 2nd quarter worth approximately $1,093,294,000. Sachem Head Capital Management LP purchased a new stake in Hut 8 during the 4th quarter valued at $129,780,000. Avala Global LP bought a new position in shares of Hut 8 during the 2nd quarter valued at $144,602,000. Wellington Management Group LLP bought a new position in shares of Hut 8 during the 2nd quarter valued at $97,949,000. Finally, Azora Capital LP lifted its holdings in shares of Hut 8 by 181.2% during the 4th quarter. Azora Capital LP now owns 690,492 shares of the company's stock valued at $31,721,000 after buying an additional 444,949 shares during the period. Institutional investors own 31.75% of the company's stock.

About Hut 8

Hut 8 Corp. NASDAQ: HUT is a North American energy infrastructure and digital asset mining company. Its operations include cryptocurrency mining, with a primary focus on Bitcoin, as well as the development and management of data center infrastructure supported by its energy resources.

The company owns and operates mining and data center facilities in the United States and Canada. In addition to self-mining digital assets, Hut 8 has pursued opportunities in high-performance computing and artificial intelligence infrastructure, using its power capacity, data center sites and related development capabilities to support evolving computing demand.

Hut 8 was originally established as Hut 8 Mining Corp., a Canadian cryptocurrency mining company.

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