Infrastructure providers, such as Northern Data (NB2), are well positioned to benefit from growing demand from artificial intelligence (AI) and high-performance computing (HPC) companies, broker Canaccord Genuity said in a report on Thursday that initiated coverage of the stock.
Canaccord assumed coverage of the shares with a buy rating and a 60 euro ($62) target price. The stock was trading 2.4% higher at 45.65 euros at press time.
Companies like Northern Data are “building the railroad for the AI gold rush,” say analysts led by Kingsley Crane. The company’s Taiga Cloud business has come online at the “forefront of what is shaping up to be a generational opportunity.”
The broker noted that Northern Data, which 52% owned by stablecoin issuer Tetherhas announced that it is exploring options to sell its Peak Mining business.
A potential divestiture would give Northern Data cash to invest in GPUs and data-center facilities, and “significantly improve the company’s growth runway beyond FY25,” the report said.
Shares still offer upside potential despite a 74% rally in the last three months, Canaccord said, adding that “investor appetite is palpable.”
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