Core Scientific Is At Least Fairly Valued On Conservative Earnings-Based Valuation

Summary

• Crypto-SPAC plays generally fall below its $10 floor after merger, however, Core Scientific-XPDI merger could be different given SDIG's price spike on Bitcoin's recovery.
• Bitcoin mining companies remain an attractive investment given the void created by China's ban on cryptocurrency.
• As a mining company, Core Scientific is only marginally larger than MARA, where both have very similar mining capacity and valuation.
• In contrast to revenue-based and adjusted EBITDA-based valuations in Core Scientific's presentation, we carried out earnings-based valuation for comps in this article.
• Our findings suggest Core Scientific has at least -16% to 10% upside whereas BITF has 66% upside based on underlying assumption.

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Introduction

One of our previous articles showed that the last 2 Bitcoin halving cycles dictate that Bitcoin would drop to $10k a low before reaching new all-time highs. However, the rule of investment is never to sell an undervalued

Analyst’s Disclosure:I/we have a beneficial long position in the shares of BITF, COIN, CND, BTC-USD either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.