SINGAPORE, Sept. 12,
2024 /PRNewswire/ -- Canaan Inc. (NASDAQ: CAN) has
been recognized for its solid operations by Rosenblatt, a Wall
Street investment firm that defines Canaan Inc. as "promising" in
light of the upcoming BTC bull market, and initiating with a "buy"
rating and a $3 price target for its
stock over the next 12 months. The report shows that Canaan is
significantly undervalued, trading at 0.6x EV/Sales, compared to
3.9x for its peer group, an undervaluation that stems from concerns
about the company's profitability and its perceived role as a
hardware provider. However, As Canaan adjusts and continues to
execute its strategy of expanding self-mining operations—using
internally developed hardware in low-cost areas, and Canaan's star
products Avalonminer's product features, resistance to
corrosion, salt and humidity, which helps it mine in low-cost
and harsh environments, such as West
Texas in the U.S and in the Middle
East regions, the company is expected to benefit from
bitcoin bull market. Rosenblatt expects its valuation
to rise and come closer to the valuations of co-location service
data center operators.
The agency's report concludes:
- BTC Bull Market Opportunity to Drive Demand for Mining
Machines: As the creator of the world's first
Bitcoin ASIC chip miner, Canan's
Avalonminer offers superior performance, energy efficiency, and
durability. Demand for the A14-based rigs doubled revenue
sequentially in 2Q24 following the April
2024 Bitcoin halving event; demand for
Avalonminers A15 series and the upcoming A16 series in the product
pipeline will continue to rise as Canaan continues to push the
boundaries of its products.
- Adjusting Strategy to Focus on Expanding Self-mining
Facilities, particularly in North
America: Canaan's management plans to increase captive
mining capacity in North America
from the current 0.65EH/s to 10EH/s by H1 2025, which is considered
as an important move to vigorously develop captive mining revenues
in a predictable growth market. In addition, Canaan is prioritizing
the development of energy-efficient mining solutions. This not only
positions the company favorably among environmentally conscious
customers, but also enhances its competitive edge in the
market.
- Extensive Patent Portfolio: Canaan's strategy for
sustainable growth includes a robust patent portfolio, with
numerous patents related to ASIC chip technology and
HPC. This intellectual property forms the backbone of Canaan's
competitive advantage and supports its long-term growth
strategy.
- Actively Exploring Strategic Alliances and
Partnerships: In addition, Canaan actively collaborates with
other technology firms and research institutions to drive
innovation and expand its market reach. These partnerships enable
Canaan to stay at the forefront of technological advancements and
offer cutting-edge solutions to its customers.
- Conclusion: Rosen Blatt recommends owning shares of
Canaan based on several key drivers: the rising
Bitcoin hash rate and price appreciation, driving
heightened demand for Canaan's next-generation mining rigs;
Canaan's strategic focus on expanding its more profitable
self-mining operations with a focus on North America; and Canaan's ruggedized rigs
which enable mining in low-cost, harsh environments.
Rosenblatt is a research and investment banking boutique and
agency focused on institutional brokers, providing specialized
services in financial services, market structure and research.
In light of the 3-parties' rating report, Canaan believes it
offers a promising outlook for the company's future growth
potential and a positive recognition of its value. It could
potentially contribute to enhancing public investor confidence,
maintaining the company's share price, and improving its capital
market image, which could in turn facilitate the company's
long-term development.
About Canaan Company: Established in 2013, Canaan Inc. (NASDAQ:
CAN) is a technology company focusing on ASIC
high-performance computing chip design, chip research and
development, computing equipment production, and software services.
Canaan has extensive experience in chip design and streamlined
production in the ASIC field. In 2013, under the
leadership of Mr. Nangeng Zhang, founder and CEO, Canaan's founding
team shipped to its customers the world's first batch of mining
machines incorporating ASIC technology in
bitcoin's history under the brand name, Avalon. In
2019, Canaan completed its initial public offering on the Nasdaq
Global Market. Contact pr@canaan-creaive.com for more
information.
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SOURCE Canaan Inc.