IREN has declined 47% from its 52-week high on Nov. 5, notably lagging behind both mining and high-performance computing (HPC) peers. However, investment bank B. Riley maintains its buy rating and a $74 price target in a report released on Monday.
Miners have averaged a 25% drop during the same timeframe, while GPU cloud companies CoreWeave (CRWV) and Nebius (NBIS) saw declines of 31% and 25%, respectively, according to analysts Nick Giles and Fedor Shabalin in the report.
The analysts described IREN’s recent price fluctuations as market sentiment-driven adjustments within a volatile AI-related sector rather than a fundamental downturn.
In early trading, the stock was down 8.2%, trading at $36.82.
Recent weeks have highlighted the stock’s volatility, as IREN surged 47% from Oct. 22 to Nov. 5, while its HPC peers averaged a 13% increase, with CoreWeave dropping 6% and Nebius rising 19% during the same period.
The analysts noted this trend suggests the stock often overshoots, and that AI-driven corrections may present entry points for investors comfortable with sector volatility.
Regarding funding, IREN is facing a $2.7 billion shortfall between available capital and approximately $11.6 billion in planned HPC capital expenditures, which include around $900 million for 23,000 GPUs in Prince George, $1.85 billion for 40,000 GPUs in Mackenzie and Canal Flats, and $8.8 billion for 76,000 GPUs associated with Microsoft at the Childress campus, as per the analysts.
The bank has identified about $8.85 billion in secured capital, which comprises Microsoft’s 20% prepayment of $1.94 billion, an estimated $2.5 billion financing for 76,000 GB300 GPUs linked to the Microsoft deal, and roughly $1 billion in cash and equivalents.
The report also pointed out recent balance sheet changes, such as around $2.3 billion in new convertible senior notes maturing in 2032 and 2033, alongside earlier issues maturing in 2029 and 2031.
B. Riley stated that net proceeds of roughly $2.27 billion from the most recent convert deal funded a $201 million capped call with an initial cap price of $82.24 per share and facilitated the repurchase of approximately $227.7 million of 2030 notes and $316.6 million of 2029 notes for a combined purchase price of around $1.63 billion, including interest. Additionally, the company’s Dec. 2 registered direct offering of 39.7 million ordinary shares at $41.12 per share, completed on Dec. 8, further bolstered the miner’s capital position.
Overall, B. Riley views the 47% pullback in IREN as a result of weak AI sentiment in a highly cyclical market rather than as an intrinsic shift in the Microsoft-focused GPU expansion. The bank believes the recent decline offers an opportunity for investors to buy into IREN ahead of a possible resurgence in AI interest and ongoing progress in its HPC development.
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