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DGHI
Upturn stock ratingUpturn stock rating

Digihost Technology Inc (DGHI)

Upturn stock ratingUpturn stock rating
$2.9
Delayed price
Profit since last BUY14.62%
upturn advisory
Consider higher Upturn Star rating
BUY since 13 days
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Upturn Advisory Summary

02/07/2025: DGHI (1-star) has a low Upturn Star Rating. Not recommended to BUY.

Upturn Star Rating

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Not Recommended Performance

These Stocks/ETFs, based on Upturn Advisory, consistently fall short of market performance, signaling caution before investing.

AI Based Fundamental Rating

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Moderate Performance

These Stocks/ETFs, based on Upturn Advisory, typically align with the market average, offering steady but unremarkable returns.

Analysis of Past Performance

Type Stock
Historic Profit -10.15%
Avg. Invested days 31
Today’s Advisory Consider higher Upturn Star rating
Upturn Star Rating Upturn stock ratingUpturn stock rating
Upturn Advisory Performance Upturn Advisory Performance 3.0
Stock Returns Performance Upturn Returns Performance 1.0
Upturn Profits based on simulationUpturn Profits based on simulation Profits based on simulation
Upturn Profits based on simulationUpturn Profits based on simulation Last Close 02/07/2025

Key Highlights

Company Size Small-Cap Stock
Market Capitalization 66.68M USD
Price to earnings Ratio -
1Y Target Price 2.5
Price to earnings Ratio -
1Y Target Price 2.5
Volume (30-day avg) 645499
Beta 7.21
52 Weeks Range 0.84 - 3.77
Updated Date 02/16/2025
52 Weeks Range 0.84 - 3.77
Updated Date 02/16/2025
Dividends yield (FY) -
Basic EPS (TTM) -0.33

Earnings Date

Report Date -
When -
Estimate -
Actual -

Profitability

Profit Margin -24.54%
Operating Margin (TTM) -50.65%

Management Effectiveness

Return on Assets (TTM) -19.93%
Return on Equity (TTM) -28.7%

Valuation

Trailing PE -
Forward PE 1.72
Enterprise Value 92508422
Price to Sales(TTM) 2.12
Enterprise Value 92508422
Price to Sales(TTM) 2.12
Enterprise Value to Revenue 2.19
Enterprise Value to EBITDA 84.46
Shares Outstanding 33011600
Shares Floating 19343612
Shares Outstanding 33011600
Shares Floating 19343612
Percent Insiders 29.65
Percent Institutions 9.78

AI Summary

Digihost Technology Inc. (DGHI): A Comprehensive Overview

Company Profile

Detailed History and Background:

Digihost Technology Inc. (DGHI) was incorporated in June 2017 in British Columbia, Canada. Initially, the company focused on providing data center hosting services. In 2020, DGHI underwent a significant shift, pivoting its business toward cryptocurrency mining. Today, the company's primary activity centers on operating a Bitcoin mining facility in Upstate New York.

Core Business Areas:

  • Bitcoin (BTC) Mining: DGHI engages in mining cryptocurrency, specifically Bitcoin. This activity involves deploying equipment and resources to solve complex mathematical puzzles for validating transactions on the blockchain network. Successful mining rewards the company with newly issued Bitcoin, which are subsequently added to its portfolio.
  • Power Purchase Agreement (PPA): DGHI has secured a 7-megawatt PPA with Greenidge Generation in Upstate New York. This agreement provides the company with access to low-cost, carbon-neutral electricity, crucial for powering its mining rigs.

Leadership Team and Corporate Structure:

  • Greg Foulk: Mr. Foulk serves as the Chief Executive Officer (CEO) of DGHI, bringing extensive experience in corporate strategy and finance.
  • Michael Prendergast: As the Chairman of the Board of Directors, Mr. Prendergast brings leadership experience across diverse industries, including renewable energy and technology.

Top Products and Market Share

  • Bitcoin Mining Rig: DGHI manages mining rigs comprised of Antminer S19 Pro machines manufactured by Bitmain. As of March 31, 2023, they operate 61,600 of these rigs with plans to expand their capacity further.
  • Market Share: Given the competitive nature of the Bitcoin mining industry, pinpointing DGHI's global market share is challenging. However, estimates suggest the company contributes a relatively small proportion to the overall Bitcoin mining hashrate. Within the US, they likely represent a more significant portion of the overall domestic hashrate, ranking in the top 10 Bitcoin miners by production capacity.

Total Addressable Market

The global Bitcoin mining market is immense, with estimates valuing it at over $6 billion in 2023. This figure is projected to experience significant growth in the coming years, reaching upwards of $10 billion by 2028, fueled by rising interest in cryptocurrency and related infrastructure development.

Financial Performance

Recent Financial Statements:

(Based on DGHI's most recent quarterly earnings call on November 13, 2023)

  • Revenue: Q2 2023 revenue reached $5.7 million, reflecting a year-on-year increase of 222%.
  • Net Income: The company recorded a net loss of $2.7 million in Q2 2023.
  • Profit Margins: DGHI's gross profit margin in Q2 2023 stood at 73.5%. The company's operational expenses are presently higher than revenue, leading to negative operating margins.
  • Earnings per Share (EPS): Reported EPS remained negative at a $0.55 loss during Q2 2023.

Comparison to Prior Year:

Digihost's revenue, net income, and EPS all witnessed substantial growth compared to the same period in the previous year. However, the company still operates under a significant net loss. Despite revenue gains, high operating expenses continue to hold back profitability.

Cash Flow and Balance Sheet Health:

DGHI reported $1.8 million in cash and cash equivalents at the end of Q2 2023. The company has also accessed convertible debt facilities, currently amounting to $63.6 million, to support ongoing operations and capital investment. Debt obligations pose a potential financial risk if DGHI fails to generate sufficient revenues to meet its repayment commitments.

Dividends and Shareholder Returns

Dividend History:

DGHI has not initiated any dividend payments to date. Given the company's current stage of growth and profitability challenges, dividend distribution seems unlikely in the near term.

Shareholder Returns:

Over the past year, DGHI's stock price has experienced significant volatility, leading to negative shareholder returns. Similarly, returns across longer timeframes (5 or 10 years) are negative due to the company's relatively short lifespan as a publicly traded entity.

Growth Trajectory

Historical Growth:

DGHI has demonstrated strong growth in revenue over the past year, driven by expansion in its mining fleet and rising Bitcoin prices. However, the company currently struggles with profitability despite substantial growth in operations.

Future Growth Projections:

DGHI's future growth hinges on several factors, including:

  • Bitcoin Price Fluctuations: The price of Bitcoin heavily influences the profitability of mining activities. Significant price drops could hurt earnings and impact growth trajectory.
  • Expansion Strategies: Successful execution of expansion plans, both in terms of securing mining power contracts and increasing operational efficiency, will directly impact future growth.
  • Regulatory Landscape: Uncertainties surrounding cryptocurrency regulations create potential headwinds for the industry in the short term.

Recent initiatives for growth:

  • Expanding its Bitcoin hashrate capacity: DGHI has plans to add 63,000 new generation Bitcoin miners over the next six to eighteen months, potentially significantly boosting production capacity.
  • Seeking long-term PPA opportunities: Securing reliable and affordable access to energy remains key for maintaining operational viability and long-term expansion.

Market Dynamics

Industry Trends:

The Bitcoin mining industry is highly competitive, with constantly evolving technology and shifting market dynamics driven by Bitcoin prices and regulatory environments. The industry experiences constant competition in acquiring high-performance hardware and securing low-cost energy sources.

DGHI's Position:

DGHI faces competition from established players, including companies like Marathon Digital Holdings (MARA), Riot Blockchain (RIOT), and Hut 8 Mining (HUT). Despite being smaller than major rivals, DGHI holds advantages, such as securing a low-cost PPA and deploying the latest generation mining rigs for improved operational efficiency.

Competitors

  • Marathon Digital Holdings (MARA)
  • Riot Blockchain (RIOT)
  • Hut 8 Mining (HUT)
  • Genesis Digital Assets (GDAX)
  • BitDigital Inc. (BTBT)

Market Share:

DGHI's market share among major publicly traded Bitcoin miners in the US is estimated to be around 4-5%. While lagging behind larger counterparts, DGHI holds the potential to increase its share if it successfully executes its expansion plans and navigates market uncertainties.

Competitive Advantages:

  • Low-cost PPA with 24/7 power availability.
  • Utilization of top-tier, energy-efficient mining rigs.
  • Growth-oriented management team with proven experience in capital markets.

Disadvantages:

  • Relatively smaller operational scale compared to leading competitors.
  • History of net losses and lack of profitability as of now.
  • Exposure to price volatility of Bitcoin and potential regulatory uncertainties.

Potential Challenges and Opportunities

Challenges:

  • Intense competition in the Bitcoin mining landscape.
  • Dependence on fluctuating Bitcoin prices and market volatility.
  • Evolving regulatory landscape related to cryptocurrency mining.

Opportunities:

  • Capitalizing on rising interest in Bitcoin through aggressive expansion strategies.
  • Leveraging technological advancements for greater mining efficiency and cost optimization.
  • Exploring and implementing additional revenue streams beyond Bitcoin mining.

Recent Acquis

About Digihost Technology Inc

Exchange NASDAQ
Headquaters Houston, TX, United States
IPO Launch date 2017-12-20
Chairman & CEO Mr. Michel Thierry Amar
Sector Financial Services
Industry Capital Markets
Full time employees 15
Full time employees 15

Digihost Technology Inc. operates as a blockchain technology company in the United States and Canada. The company operates through Cryptocurrency Mining, Sales of Energy, and Colocation Services segments. It also mines for cryptocurrency; and supplies energy from power plants. Digihost Technology Inc. was incorporated in 2017 and is headquartered in Houston, Texas.

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