TD Cowen Initiated TeraWulf Coverage With Buy Rating
The firm sees upside for the data center operator as it pivots from mining to AI-focused infrastructure.
Updated on Oct. 12, 2026 in Data Centers
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TD Cowen has initiated coverage on TeraWulf with a $21 price target, signaling confidence in the company's transition from Bitcoin mining to AI data center operations. TeraWulf stock closed at $13.77 on Friday, representing a 52.5% implied upside according to the new rating.
Why it matters
Analysts suggest the market currently undervalues TeraWulf's data center business by applying a conservative 9% cap rate to its infrastructure leases. This pivot reflects a broader trend of miners repurposing power-dense energy sites to meet the rising demand for specialized AI cloud capacity.
TD Cowen assigned a $21 price target to TeraWulf, while Morgan Stanley has issued a significantly higher target of $65. The company's stock has gained 20% year-to-date but currently trades 54% below its 52-week high of $29.84.
The players
TeraWulf
An energy-focused infrastructure company transitioning its Bitcoin mining fleet into AI-ready data centers.
TD Cowen
A financial services firm providing investment banking and equity research on technology and energy markets.
A global cloud computing provider that holds warrants for an estimated 8% of TeraWulf and backs select tenant lease payments.
Fluidstack
A cloud infrastructure provider that leases data center capacity from TeraWulf.
Morgan Stanley
A global financial institution that maintains a $65 price target for TeraWulf shares.
The details
TeraWulf generates revenue by converting former Bitcoin mining facilities into data centers that provide the high power density required by AI hardware. The company leases this capacity to cloud providers, including Fluidstack, which benefits from Google guarantees on specific lease payments. Google maintains an estimated 8% stake in TeraWulf through warrants.
Timeline
October 9, 2026: TeraWulf stock closed at $13.77.
October 12, 2026: TD Cowen initiated coverage of TeraWulf.
The Tech Race
TeraWulf's transition follows the industry-wide trend of converting Bitcoin mining sites into AI-capable data centers to solve power constraints. This move positions the company to compete for long-term cloud leases, a shift analysts are now recalibrating against traditional data center valuation metrics.
Investors can track the company's valuation performance against the average 12-month analyst target of $33.58. The ongoing shift to AI capacity suggests that future earnings reports will likely prioritize data center lease occupancy over crypto mining output.
The takeaway
The valuation of TeraWulf hinges on whether investors accept a transition from volatile crypto mining to the stable, long-term yields of AI infrastructure leasing. Watch for future analyst revisions that may adjust the currently applied 9% cap rate as the company demonstrates sustained leasing growth.
Further reading
For more on the scaling of high-density infrastructure, visit the Data Centers section.
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