Hut 8 Soars 17.7% on Record High Price Target and AI Expansion Catalysts – What’s Next for the Digital Infrastructure Giant?

Summary
• Hut 8 (HUT) surges 17.7% intraday to $52.63, its highest level since 2023
• Benchmark analyst upgrades price target to $85, the highest on Wall Street
• $7B data center lease and AI partnerships with Anthropic and Google drive optimism
• Options frenzy: 521.57% price change ratio on 50-strike call options

Hut 8’s 17.7% intraday surge has ignited a firestorm in the digital infrastructure sector, fueled by a record-high price target from Benchmark and a $7 billion data center lease. The stock’s meteoric rise—from $45.14 to $52.63—reflects investor frenzy over the company’s AI expansion plans and strategic partnerships. With options volume spiking and leveraged ETFs like BLOX and MNRS rallying, the question now is whether this momentum can sustain or if it’s a short-term speculative frenzy.
Benchmark’s $85 Price Target and $7B Data Center Lease Ignite Bullish Sentiment
Hut 8’s explosive move stems from a dual catalyst: Benchmark analyst Mark Palmer raising the price target to $85 (the highest on Wall Street) and the company securing a 15-year, $7 billion data center lease in Louisiana. The lease, which includes 245 MW of capacity at the River Bend campus, positions Hut 8 to scale AI infrastructure for Anthropic, Fluidstack, and Google. Palmer highlighted the deal’s superior economics, long-dated cash flows, and embedded expansion options, while the company’s ownership stake in American Bitcoin adds a crypto tailwind. This strategic pivot from Bitcoin mining to AI infrastructure has redefined Hut 8’s revenue durability, attracting both institutional and retail investors.

Data Processing Sector Gains Momentum as IBM Trails Behind
The Data Processing & Outsourced Services sector has seen mixed performance, with Hut 8’s 17.7% surge dwarfing IBM’s 0.57% intraday gain. While IBM remains a sector leader, Hut 8’s AI-focused expansion and high-conviction analyst upgrades have shifted investor attention toward high-growth digital infrastructure plays. The sector’s broader optimism is evident in leveraged ETFs like Direxion’s LMBO (3.59% up) and Amplify’s BLOK (1.65% up), which track blockchain and AI themes. Hut 8’s strategic partnerships with AI giants position it to outperform peers in a sector increasingly dominated by AI-driven infrastructure demand.

Options and ETFs to Capitalize on Hut 8’s AI-Driven Bull Run
• Technical Indicators:
- 200-day MA: $26.2 (well below current price)
- RSI: 50.7 (neutral)
- MACD: -0.36 (bullish divergence)
- Bollinger Bands: Price at $51.94 vs. upper band $48.20
- Kline pattern: Short-term and long-term bullish trends

Trading Setup: With Hut 8 trading above its 200-day MA and RSI hovering near neutrality, the stock is in a strong accumulation phase. The 52-week high of $57.29 remains a critical resistance level. Leveraged ETFs like Direxion’s LMBO (3.59% up) and Grayscale’s MNRS (3.26% up) offer amplified exposure to the AI/crypto theme. For options, focus on near-term calls with high leverage ratios and moderate deltas to capture volatility.

Top Options:
1. HUT20251226C50 (Call, $50 strike, 2025-12-26 expiration)
- IV: 87.13% (high)
- Leverage Ratio: 16.09%
- Delta: 0.669 (moderate)
- Theta: -0.4547 (high time decay)
- Gamma: 0.0684 (high sensitivity)
- Turnover: $1.27M
- Payoff at 5% upside ($54.54): $4.54/share (521.57% gain)
- This call offers explosive upside if Hut 8 breaks above $50, with high gamma ensuring rapid premium growth as the stock rises.

2. HUT20251226C51 (Call, $51 strike, 2025-12-26 expiration)
- IV: 88.13% (high)
- Leverage Ratio: 19.54%
- Delta: 0.595 (moderate)
- Theta: -0.4431 (high time decay)
- Gamma: 0.0723 (high sensitivity)
- Turnover: $119.97K
- Payoff at 5% upside ($54.54): $3.54/share (507.50% gain)
- This contract balances leverage and liquidity, ideal for aggressive bulls expecting a sustained move above $51.

Action: Aggressive bulls should prioritize HUT20251226C50 for maximum leverage, while conservative traders may use HUT20251226C51 as a hedge. Both contracts benefit from high gamma and IV, amplifying returns if the stock breaks above $50.

Backtest Hut 8 Stock Performance
The backtest of an 18% intraday surge from 2022 to the present for the HUT ETF shows a strategy return of 34.21%, with a benchmark return of 42.97% and an excess return of -8.77%. The strategy has a CAGR of 7.78% and a maximum drawdown of 0.00%, indicating a stable but conservative performance during the backtested period.

Hut 8’s AI Infrastructure Play: A High-Volatility Opportunity with Clear Catalysts
Hut 8’s 17.7% surge is a textbook example of momentum-driven speculation, fueled by a record-high price target and a transformative $7B data center lease. While the stock’s technicals remain bullish (RSI neutral, MACD diverging), investors must monitor the 52-week high of $57.29 and key resistance at $54.54. The options frenzy—particularly in the 50-strike call—suggests a high conviction in the AI infrastructure narrative. For context, sector leader IBM’s 0.57% gain pales in comparison to Hut 8’s volatility, underscoring the market’s appetite for high-growth plays. Act now: Buy HUT20251226C50 for a 521.57% payoff if the stock hits $54.54, or short-term traders should watch for a breakdown below $49.50 to trigger a reversal.