TLDR
- American Bitcoin stock collapsed 39% Dec. 2 when lock-up expired, now down 72% from September debut
- Roth Capital started coverage with Buy rating and $4 target, sees unique mining-treasury advantage
- Holdings reached 4,783 Bitcoin after company purchased 416 coins worth $38 million last week
- Unlike pure treasuries, mining generates cash flow for strategic Bitcoin purchases when economics work
- Analyst forecasts 26,000 coin holdings by second half 2027 through mining and market buying
American Bitcoin stock just lived through every investor’s nightmare. Shares cratered 39% on Dec. 2 when the lock-up period ended and early backers ran for the door.
The selling hasn’t stopped. Shares traded at $1.94 Wednesday, down another 5.4%. That puts the stock 72% below where it started trading in September.
The Eric Trump co-founded miner has been a disaster for anyone who bought at launch. But one analyst thinks the worst is over.
Roth Capital initiated coverage Wednesday with a Buy rating. The firm set a $4 price target, suggesting 106% upside from current levels.
Darren Aftahi, the Roth analyst behind the call, sees something the market doesn’t. He thinks American Bitcoin’s business model creates an edge other crypto companies lack.
The company reported Wednesday it now owns 4,783 Bitcoin. Last week alone it bought 416 coins for roughly $38 million.
That pushed the satoshis per share metric to 507. The figure jumped more than 17% in just one month. It tells investors how much Bitcoin actually backs each share.
Mining Makes the Difference
Most Bitcoin treasury companies play one game. Raise money through stock sales and debt. Buy crypto. Do it again.
American Bitcoin plays a different game. The company mines Bitcoin while other operations chased AI and advanced computing opportunities.
The Hut 8 partnership gives American Bitcoin access to data centers, power, and operations expertise. That infrastructure lets the company mine profitably when conditions align.
Here’s where it gets interesting. Mining creates actual cash flow when margins work. American Bitcoin can use that cash to buy more Bitcoin when prices make sense.
Pure treasury companies can’t do that. They need constant access to capital markets to fund purchases.
Aftahi believes this hybrid approach lets American Bitcoin grow holdings faster than competitors. His model shows 26,000 coins by late 2027 through combined mining and buying.
The company went public through a reverse merger with Gryphon Digital Mining in September. Eric Trump and his brother Donald Trump Jr. kept about 98% of the merged entity with Hut 8.
That merger brought $220 million through equity sales. Management said the money would go toward Bitcoin and mining gear. They’ve emphasized mining as the primary growth driver over market purchases.
Treasury Grows Rapidly
American Bitcoin’s accounting captures the full picture. The numbers include coins bought but awaiting wallet settlement, Bitcoin in custody, and coins allocated for miner purchases.
Bitcoin gained 1.4% in the 24 hours before the company’s announcement. American Bitcoin now sits among the top 25 public Bitcoin treasury holders globally.
The company got there in just three months of trading. That ranks it among the fastest-growing treasury operations in the publicly traded mining space.
Roth disclosed it provided investment banking services to American Bitcoin and Hut 8 in the past year. The firm also works with other Trump-connected ventures in various capacities.
Few analysts cover American Bitcoin currently. Roth’s Buy rating marks the first bullish call since the stock began trading. The lock-up expiration on Dec. 2 let major shareholders from the June private placement sell their positions freely. The resulting selloff pushed shares to current levels where Aftahi sees value emerging.
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