Hut 8 (NASDAQ:HUT) Stock Falls 13.2% on Analyst Downgrade

Key Points

• Hut 8 shares fell 13.2% to about $57.67 after B. Riley cut its price target from $163 to $134, though it maintained a buy rating.
• Analyst sentiment remains broadly positive, with a consensus “Buy” rating and average price target of $146.77, despite one sell rating and recent target reductions from several firms.
• Hut 8 reported a larger-than-expected quarterly loss of $1.27 per share and revenue below estimates, while insiders recently reduced their holdings through stock sales.

Hut 8 Corp. (NASDAQ:HUT - Get Free Report)'s share price dropped 13.2% on Friday after B. Riley Financial lowered their price target on the stock from $163.00 to $134.00. B. Riley Financial currently has a buy rating on the stock. Hut 8 traded as low as $58.11 and last traded at $57.6740. 2,641,903 shares traded hands during mid-day trading, a decline of 46% from the average daily volume of 4,930,533 shares. The stock had previously closed at $66.44.

A number of other research analysts have also recently commented on HUT. Morgan Stanley raised their target price on Hut 8 from $273.00 to $275.00 and gave the company an "overweight" rating in a research note on Friday, October 9th. Weiss Ratings cut shares of Hut 8 from a "hold (c-)" rating to a "sell (d+)" rating in a research note on Wednesday, August 19th. UBS Group reaffirmed a "buy" rating on shares of Hut 8 in a report on Thursday, October 8th. Freedom Broker raised Hut 8 to a "strong-buy" rating in a research note on Tuesday, August 18th. Finally, Needham & Company LLC decreased their price target on Hut 8 from $145.00 to $138.00 and set a "buy" rating for the company in a research note on Wednesday, August 5th. Four equities research analysts have rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating, one has issued a Hold rating and one has issued a Sell rating to the company's stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Buy" and an average target price of $146.77.

Insider Activity at Hut 8

In related news, CFO Sean Glennan sold 6,445 shares of the company's stock in a transaction that occurred on Monday, August 24th. The shares were sold at an average price of $78.76, for a total transaction of $507,608.20. Following the sale, the chief financial officer directly owned 17,978 shares in the company, valued at approximately $1,415,947.28. This represents a 26.39% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, Director Mayo A. Shattuck III sold 20,000 shares of the firm's stock in a transaction that occurred on 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 sale, the director directly owned 89,408 shares in the company, valued at approximately $8,940,800. The trade was a 18.28% decrease in their position. The SEC filing for this sale provides additional information. 10.40% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Hut 8

A number of hedge funds and other institutional investors have recently modified their holdings of the company. BlackRock Inc. bought a new stake in shares of Hut 8 during the second quarter worth $1,093,294,000. Avala Global LP bought a new position in shares of Hut 8 in the 2nd quarter valued at about $144,602,000. Wellington Management Group LLP acquired a new stake in Hut 8 in the 2nd quarter valued at about $97,949,000. Montanova Capital LLC bought a new position in shares of Hut 8 during the second quarter worth approximately $77,348,000. Finally, Connor Clark & Lunn Investment Management Ltd. acquired a new stake in shares of Hut 8 in the second quarter valued at approximately $56,364,000. 31.75% of the stock is currently owned by hedge funds and other institutional investors.

Hut 8 Price Performance

The business's 50 day moving average is $84.56 and its 200-day moving average is $82.34. The firm has a market capitalization of $7.07 billion, a P/E ratio of -10.53 and a beta of 4.62. The company has a quick ratio of 19.35, a current ratio of 19.35 and a debt-to-equity ratio of 4.22.

Hut 8 (NASDAQ:HUT - Get Free Report) last released its quarterly earnings results on Wednesday, August 5th. The company reported ($1.27) EPS for the quarter, missing analysts' consensus estimates of ($0.55) by ($0.72). The company had revenue of $74.93 million during the quarter, compared to analysts' expectations of $79.37 million. Hut 8 had a negative return on equity of 0.97% and a negative net margin of 188.59%. During the same period in the prior year, the firm earned $1.18 EPS. As a group, sell-side analysts predict that Hut 8 Corp. will post -2.93 EPS for the current fiscal year.

Hut 8 Company Profile

Hut 8 Corp. is a North American energy infrastructure and computing company whose business includes digital asset mining, high-performance computing and data center operations. The company develops and manages power and infrastructure assets intended to support energy-intensive computing applications.

Hut 8's activities have historically centered on Bitcoin mining, supported by company-operated data centers and specialized mining equipment. It also provides infrastructure for emerging computing applications, including artificial intelligence and other high-performance computing workloads, as it seeks to expand beyond cryptocurrency mining.

The company was established in Canada and expanded its operations in the United States through its combination with U.S.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.