Key insights
- StoneX reiterated a Buy rating and $57.00 price target on Galaxy Digital (GLXY) shares, despite recent concerns about its tenant CoreWeave's creditworthiness. The analyst believes the market is overreacting to CoreWeave's financial situation, arguing that the math favors Galaxy Digital's shareholders. InvestingPro data suggests the stock is undervalued. Other analysts also maintain Buy ratings, citing improving crypto markets and HPC potential, even as Galaxy Digital reported a Q2 loss.
Investing.com - StoneX reiterated a Buy rating and $57.00 price target on Galaxy Digital Holdings Ltd. (NASDAQ:GLXY) shares.
Galaxy Digital shares fell approximately 30% over a two-week period, according to StoneX analyst Mark Palmer. The decline extended last week, with the stock dropping 24.5% over the past week and now trading at its 52-week low of $16.76.
The selloff was driven by concerns about the creditworthiness of CoreWeave, the neocloud company that is Galaxy Digital’s first and only signed tenant at Helios, its AI data center campus in West Texas. CoreWeave’s unsecured bonds were yielding approximately 15% and its 5-year credit default swaps were trading above 1100 basis points at the end of last week.
The market has concluded that a landlord to a stressed neocloud deserves to trade like one, Palmer said. The analyst said that conclusion overlooks the reality of Galaxy Digital’s situation and the extent to which the math works in favor of its shareholders. InvestingPro data suggests the stock is undervalued at current levels, with analysis indicating the recent selloff may present an opportunity for investors. For deeper insights, Galaxy Digital is one of 1,400+ US equities covered by comprehensive Pro Research Reports.
StoneX maintained its Buy rating on the stock.
In other recent news, Galaxy Digital Holdings reported a second-quarter loss, with a GAAP net loss of $85 million and a firm-wide adjusted EBITDA of negative $77 million. Despite the loss, the company highlighted the completion of phase one of its Helios data center, marking a significant step in its AI infrastructure strategy. Compass Point raised its price target for Galaxy Digital to $36, maintaining a Buy rating, citing improving cryptocurrency market conditions and potential deals in high-performance computing. Meanwhile, H.C. Wainwright reiterated its Buy rating with a $40 price target, even though Galaxy Digital’s second-quarter results fell short of expectations amid a challenging period for cryptocurrency prices. These developments are part of Galaxy Digital’s ongoing efforts to expand its digital asset and data center businesses.
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