Compass Point said Applied Digital, TeraWulf and Cipher Mining trade below the value of their signed AI data center contracts, suggesting investors may be undervaluing the firms based on contract income rather than bitcoin mining economics.

The firm noted that several companies converting former bitcoin mining sites into AI data centers may be worth more than their current market valuations imply because investors underestimate the value of long‑term rental agreements. Analysts Michael Donovan and Ed Engel developed a framework that separates the value of existing AI leases from projects without customers, arguing that these companies should be valued more like landlords generating rental income. They estimate the present value of contracted rental income after accounting for remaining construction costs and compare this figure with each company's enterprise value.

Using the approach, Compass Point identified Applied Digital (APLD), TeraWulf (WULF) and Cipher Mining (CIFR) as showing the greatest mismatch between contracted business and market valuation. In each case the market assigns little or no value to unleased AI capacity, despite its potential to generate significant rental income once projects are completed. Core Scientific (CORZ) and Riot Platforms (RIOT) are evaluated differently; Core Scientific's existing contracts largely reflect its valuation, while Riot is priced more on future potential than current lease income. The report says the next two years will be a turning point as companies move from announcing AI infrastructure deals to delivering them, with rent payments beginning as projects are completed. As cash flow becomes evident, investors are expected to shift focus from future potential to the recurring revenue generated by the facilities. The sector, already one of the strongest AI‑related trades, has seen sharp share gains over the past year as former miners announce partnerships with hyperscalers and AI firms. Returns have varied as investors weigh construction timelines, financing needs and the pace of customer signings.