Hi Darren,
In terms of Sydney based, US-listed IREN Ltd (IREN US), formerly known as Iris Energy, which is using earnings from bitcoin mining to build out next-generation data centers powered entirely by renewable energy, as we said last week, looks very interesting. While it’s small for our international portfolio with a $US2.1bn market cap, they are clearly at an inflexion point for their business.
They released a strong quarterly earlier in May, and the positive trends continued as outlined in their monthly update released yesterday. Their Bitcoin mining operation had its best month in May on record, and they are making strong progress across their AI verticals. Monthly revenue of $64.7m came primarily from Bitcoin mining, and they are on track to almost double the $25m profit they booked last quarter in 1Q26 (consensus $47m profit this quarter). As a side note for those interested, it costs them about $US27k in energy to mine one Bitcoin, and for those not familiar with what Bitcoin mining actually is, below we have provided a quick overview.
They are funnelling these funds into a data centre roll out strategy which is also progressing at pace. Obviously, this is a pretty complex area and we’re not Bitcoin mining experts, which makes us somewhat cautious, however, on a review of their historical numbers and forecasts, which are supported by decent analyst coverage (12 analysts cover IREN), consensus earnings have some validity and foundation, and the direction of the business is impressive. They have no debt, can fund their plans, and have been executing well.
Recent price action is bullish. We like it here and are likely to take a small position in the International Equities Portfolio, to establish a foothold and build our conviction from there. A higher risk stock given the nature of the business, however, if they continue to execute, we believe they are worth well north of the current $US9.75 share price., On 20x consensus earnings for FY26, they are worth ~$US19.
Regarding the PM report, there will always be one unless on the very rare occasions we have some sort of technical issue which happens sporadically, or Public Holidays etc, with the later flagged beforehand. The PM (Match Out) Report is always on the MM website before the emails are sent to subscribers. We do endeavour to send in a timely manner but there tends to be lots going on during a trading day. The difference with MM v other (theoretical reports) is we’re active in markets on a daily basis, and this can create a bit a time pressure. In any case, we do our absolute best to get things out by 10am for the morning note and 5pm for the afternoon.
Bitcoin mining is like a big competition to solve math puzzles. Here’s how it works in simple terms:
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The goal: People (called miners) try to solve a complex math problem using computers. The first one to solve it gets to add a new “block” of transactions to the Bitcoin network—a bit like adding a page to a digital ledger.
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The reward: The miner who solves the problem gets paid in new bitcoins. This is how new bitcoins are created.
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Why it’s important: Mining helps keep the Bitcoin network running safely. It checks and records all the Bitcoin transactions, making sure no one cheats by spending the same bitcoin twice.
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The catch: It takes a lot of electricity and powerful computers to mine Bitcoin.
So in short: Bitcoin mining is how new bitcoins are made and how the network stays secure—by solving hard problems with computers.
