Citigroup Joins Bullish Coverage on Bitcoin Mining Stock

Citigroup initiated TeraWulf with a buy rating and a $36 price target, citing the company’s ability to alleviate power bottlenecks for AI data centers and its multi-year growth opportunity. The stock was up 3.9% premarket and remains up 124.8% year to date after recently hitting a more than four-year high of $29.84. Sentiment is already very constructive, with 17 buys, one hold, and no sells, though short interest remains elevated at 28.49% of float.

Analysis

The market is starting to price WULF less like a speculative miner and more like a constrained power monetization story. That matters because the bottleneck in AI infrastructure is shifting from compute hardware availability to reliable, low-cost megawatts; if management can keep converting power access into contracted load, the multiple can stay elevated even without near-term earnings inflection. The second-order winner is the broader ecosystem of grid-connected power and electrical infrastructure providers, while the loser set is any AI infrastructure name still reliant on third-party colocation capacity or slower interconnect timelines.

The setup is technically extended but not obviously broken. After a rapid re-rating, the stock is likely to trade on incremental flow and positioning more than fundamentals over the next 2-6 weeks; that creates upside if the market believes there is a repeatable pipeline of power expansion, but also sharp air pockets if execution slips. The elevated short interest is fuel for another squeeze, yet it also increases the probability of violent mean reversion on any missed milestone, financing concern, or broader risk-off tape.

Consensus is probably underestimating how much of the valuation is now contingent on continued scarcity of AI-ready power rather than on the company itself. If the market becomes convinced the power constraint is easing elsewhere, WULF’s relative advantage compresses quickly because the current premium is partly a scarcity premium. In that sense, the real risk is not a bad quarter; it is a regime shift in AI infrastructure capex where power becomes more commoditized and multiple support fades over a multi-month horizon.

Key Decisions for Investors

• Trade with the squeeze, not against it: buy WULF on pullbacks toward the 40-day moving average with a 2-4 week horizon, targeting a re-test of prior highs; keep risk tight because a failed support break could unwind the entire momentum leg quickly.
• For investors unwilling to chase spot, use a call spread in WULF for the next 1-2 months to capture upside from continued short covering while capping premium paid if the move stalls.
• Pair idea: long WULF / short a less power-constrained AI infrastructure peer over 1-3 months to isolate the market’s willingness to pay up for scarce megawatts versus generic AI exposure.
• If entering long equity, size smaller than usual and predefine a stop below the recent swing low; the name is still a sentiment trade first and a fundamentals trade second.
• Use any 10-15% rip from current levels to trim or hedge, because the easy part of the re-rating may already be behind it and incremental upside now depends on sustained execution rather than new narrative.