By Cheng Xin Contributor Trefis Team
CHONGQING, CHINA – MAY 11: In this photo illustration, the logo of Iris Energy Ltd. is displayed on … More a smartphone screen, with the company’s green branding visible in the background, on May 11, 2025, in Chongqing, China. (Photo illustration by Cheng Xin/Getty Images)
Getty Images
IREN (NASDAQ:IREN) – a Bitcoin mining data center operator that utilizes renewable energy sources such as solar and wind – has witnessed an impressive stock increase of nearly 80% over the last month. This notable rise can be linked to several recent positive events:
June 13: IREN successfully concluded a $550 million 3.5% convertible senior notes offering, which significantly enhanced market confidence.
June 30: The company announced that it had achieved its mid-year goal of 50 EH/s in installed self-mining capacity, marking a key operational milestone.
July 3: IREN disclosed the acquisition of 2,400 next-generation NVIDIA Blackwell B200 and B300 GPUs to facilitate its growing AI Cloud Services.
While these developments have undoubtedly thrilled investors, the pivotal question now is whether IREN stock, currently trading at approximately $16 following an 80% rally, remains an attractive investment.
Our evaluation indicates that it does. We consider the stock a solid choice at its current price of about $16. However, it is essential to recognize that there are several concerns regarding IREN, particularly its currently elevated valuation, which poses a significant level of risk.
Our conclusion is derived from a thorough comparison of IREN’s current valuation against its operational performance in recent years, alongside its historical and present financial state. Our analysis across key metrics—Growth, Profitability, Financial Stability, and Downturn Resilience—shows that the company currently exhibits poor operating performance and financial health, as further elaborated below.
However, for investors seeking lower volatility than individual stocks, the Trefis High Quality portfolio offers an alternative — having outperformed the S&P 500 and provided returns exceeding 91% since its inception. Separately, refer to – SOUN Stock To $20?
MORE FOR YOU
How Does IREN’s Valuation Compare to the S&P 500?
Based on the price you pay per dollar of sales or profit, IREN stock appears costly relative to the broader market.
IREN has a price-to-sales (P/S) ratio of 9.5 compared to a figure of 3.1 for the S&P 500
How Have IREN’s Revenues Progressed in Recent Years?
IREN’s revenues have significantly increased in recent years.
IREN has experienced its top line grow at an average rate of 270% over the past 3 years (against an increase of 5.5% for the S&P 500)
Its revenues have increased by 127.2% from $165 million to $375 million in the last 12 months (compared to growth of 5.5% for the S&P 500)
Furthermore, its quarterly revenues rose by 168.4% to $145 million in the most recent quarter, up from $54 million a year prior (for comparison, a 4.8% rise for the S&P 500)
How Profitable Is IREN?
IREN’s profit margins are notably poorer than most firms in the Trefis coverage universe.
IREN’s Operating Income over the last four quarters was $-19 million, representing a very poor Operating Margin of -5.0%
During the last four-quarter period, IREN’s Net Income was $-36 million — indicating a very poor Net Income Margin of -9.5% (compared to 11.6% for the S&P 500)
Nonetheless, the company’s adjusted EBITDA of $54 million last year demonstrated a strong margin of 29%.
How Resilient Is IREN Stock During Economic Downturns?
IREN stock has performed significantly worse than the benchmark S&P 500 index during the inflation downturn in 2022. While investors are hopeful for a soft landing by the U.S. economy, one must consider how severely the situation could worsen if another recession occurs. Our dashboard How Low Can Stocks Go During A Market Crash illustrates how key stocks performed during and after the previous six market crashes.
Inflation Shock (2022)
IREN stock dropped 95.7% from a peak of $24.80 on November 19, 2021, to $1.06 on December 28, 2022, whereas the S&P 500 experienced a peak-to-trough decline of 25.4%
The stock has still not recovered to its pre-Crisis high
The highest the stock has attained since then is 15.66 on July 3, 2025
Bringing It All Together: What It Means for IREN Stock
In conclusion, IREN’s performance across the criteria outlined above is as follows:
Growth: Extremely Strong
Profitability: Extremely Weak
Financial Stability: Extremely Weak
Downturn Resilience: Extremely Weak
Overall: Weak
While our analysis indicates that IREN’s operating performance and financial situation are currently weak, which suggests a level of risk, the company’s remarkable growth should not be overlooked. Over the past three years, IREN has achieved an average annual growth rate of 270%, a trend we anticipate will continue in triple digits for at least the next couple of years.
Given this robust growth path, we believe that a valuation of 9 times trailing revenues is not excessively high and implies that the stock likely has some potential for further appreciation. Therefore, notwithstanding the recognized risks, we conclude that IREN is a worthwhile stock to purchase.
Although IREN stock appears promising, investing in a single stock carries risks. Conversely, the Trefis High Quality (HQ) Portfolio, comprising 30 stocks, has a history of comfortably outperforming the S&P 500 over the past four years. What accounts for this? Collectively, HQ Portfolio stocks have delivered superior returns with lower risk compared to the benchmark index; a smoother performance, as evidenced in HQ Portfolio performance metrics.
Editorial StandardsReprints & Permissions