Canaan Inc. (CAN) Stock Forecast & Price Target

Canaan Inc. has strategically expanded its Bitcoin mining business, resulting in a growing contribution from self-mining, which now accounts for approximately 25% of year-to-date revenue, marking a significant year-over-year increase of around 900 basis points. The company's average selling prices (ASPs) for its mining rigs have also seen strong growth, reaching their highest levels since 2022, thereby driving record product sales in recent quarters. Furthermore, Canaan's self-mining revenue has increased by approximately 200% year-over-year, supported by a nearly doubling of its self-mining fleet, positioning the company for potential outperformance in the market through enhanced rig efficiency and sales growth.

Canaan Inc.'s outlook is negatively impacted by the anticipated slowdown in research and development capital expenditures as the efficiency of new rigs is projected to improve modestly, with J/TH targets aimed at 10-13 compared to current rig efficiencies. The shift among U.S. miners towards high-performance computing (HPC) is expected to slow global hash rate growth, alongside the recent decline in Bitcoin prices, which have also contributed to reduced demand for mining equipment and delayed new orders. Furthermore, Canaan risks losing market share if it fails to keep pace with technological advancements, raising concerns about its future earnings and overall valuation in a deteriorating market environment.