Here's Why I Sold Cipher Digital and Bought More Iren
2026-10-09 11:30
•Marc Guberti •The Motley Fool
•••• ••••••• Axe Cap view
Why I’m Betting on Iren Over Cipher Digital
Iren’s superior pricing and faster capacity growth make it a smarter play in AI data center infrastructure.
The hype around AI is pushing data center stocks, but not all are equal. Cipher Digital’s lower per-megawatt contract values and slower capacity rollout reveal its limits. Iren, on the other hand, commands nearly five times the contract revenue per megawatt and plans to add 500 MW by 2027, versus Cipher’s 270 MW. Rising megawatt prices and significant customer prepayments—covering almost half of GPU capital expenditure—give Iren a more sustainable growth runway despite heavy upfront investments. While large tech customers like Microsoft back Iren, caution is warranted; higher capital intensity and dilution could bite if costs spiral or if contract renewal terms change. For South African investors, the story is a reminder: focus on companies with tangible, scalable assets that can weather rising cost pressures. this is just our opinion and not financial advice
Trim or avoid Cipher Digital due to its weaker contract economics. Increase exposure to Iren, which is better positioned to benefit from AI’s infrastructure demand, but monitor capital costs closely.
- IREN
- CIFR
- USD/ZAR
- Capital intensity causing margin compression
- Potential slowdown in contract renewals or megawatt price growth
7/10
An analyst sold Cipher Digital shares to increase positions in Iren, citing Iren's superior per-megawatt contract values, larger pipeline (5.8 gigawatts), and faster capacity deployment (500 MW in 2027 vs. Cipher Digital's 270 MW). Rising megawatt prices and customer prepayments are expected to help Iren offset capital intensity and dilution concerns.
Our take is based on reporting first published by The Motley Fool.