Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.
Hello, With the obvious advent of AI and the increasing demands on data centres, are you evaluating any of the data centre players overseas, mainly US, as possible investments? In particular have you come across Iris Energy Ltd (IREN)?
Hi David,
This is a new company for us, not one that has come across our radar before given its size, a US$2bn market cap is small over there, and we focus on the larger cap companies for our International Equities Portfolio. This is because we’re not close enough, and don’t have enough access to really understand US small caps – it’s hard enough in Australia.
That said, this is a really interesting company, and without having a deep understanding of it, leveraging their energy business into areas like Bitcoin mining (traditionally) and now into Data Centres appears quite interesting, and on consensus forecasts, this will start to see them generate positive earnings from FY25 onwards, having lost money last year. Very strong revenue growth is now forecast, and on consensus numbers below, they are expected to generate a $220m profit in FY26, placing them on ~11x earnings, with 7 analysts covering the stock.
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