Cango Inc.'s Undervalued Position in Bitcoin Mining and AI Infrastructure

Cango Inc. (NYSE: CANG) has emerged as a compelling case study in strategic reinvention, transitioning from an automobile trading platform to a dual-focused operator in Bitcoin mining and AI infrastructure. As of Q3 2025, the company reported a 60.6% revenue surge year-over-quarter, driven by Bitcoin mining operations that generated $220.9 million in revenue. This growth, coupled with an asset-light approach to AI infrastructure development, positions Cango as an undervalued player in high-growth sectors.

Bitcoin Mining Efficiency and CAPEX Discipline

Cango's operational efficiency in Bitcoin mining has improved markedly. The company's average operating hashrate increased from 40.91 EH/s in July 2025 to 46.09 EH/s by October, achieving over 90% efficiency. This progress stems from facility relocations, hardware upgrades (e.g., T21 and S21 series), and a strategic focus on hash rate optimization rather than expansion according to earnings call notes. Such discipline is critical in an industry where all-in costs often erode margins.

The acquisition of a 50-megawatt mining facility in Georgia further underscores Cango's commitment to securing energy infrastructure, a foundational step for both Bitcoin mining and future AI compute needs according to the company's Q3 earnings transcript. This move aligns with the company's sequencing strategy: leveraging Bitcoin mining to establish energy access and operational expertise before pivoting to higher-margin AI infrastructure services.

AI Infrastructure: A Distributed, Asset-Light Model

Cango's AI infrastructure strategy is centered on building a global, distributed compute grid powered by green energy. The company's near-term focus on GPU computing power leasing-targeting AI startups and compute platforms-adopts an asset-light model that minimizes capital intensity. By integrating dispersed GPU resources into standardized pools, Cango aims to offer scalable, elastic compute solutions tailored for small and mid-sized enterprises as reported in recent industry analysis.

Long-term, the company envisions a regional AI compute network, supported by data center hubs and renewable energy projects. Pilot initiatives in Oman and Indonesia, expected to be commissioned within one to two years, will serve as foundational infrastructure for this vision. Unlike traditional data centers, Cango's distributed model reduces upfront costs and environmental impact, aligning with global trends toward sustainable computing.

Market Valuation and Analyst Optimism

Despite a Q2 2025 loss of -$2.76 per share and a stock price decline of 2.47% to $4.85, Cango remains undervalued relative to its peers. Greenridge Capital recently initiated coverage with a "Buy" rating and a $4.00 price target, citing the company's Bitcoin mining scale and asset-light HPC entry as overlooked strengths. Analyst projections suggest a 15x P/E ratio by 2026, based on an adjusted EPS estimate of $0.34, while Greenridge factors in a 7x EV/Adj. EBITDA multiple tied to $335.4 million in 2026 adjusted EBITDA.

Cango's current market cap of $301.2 million appears disconnected from its long-term potential. The company's Bitcoin holdings and energy infrastructure provide a stable cash flow base, while its AI infrastructure roadmap offers a path to higher-margin revenue streams.

HPC Expansion: A Strategic Bridge to Growth

Cango's transition into high-performance computing (HPC) is a natural extension of its energy and Bitcoin expertise. By leveraging existing power infrastructure, the company aims to develop a global network of HPC centers powered by renewable energy. This approach mirrors the asset-light model of its AI infrastructure strategy, avoiding the capital-intensive pitfalls of traditional data center construction.

While technical specifics remain undisclosed, Cango's sequencing strategy-starting with Bitcoin mining to secure energy access, then scaling into HPC- demonstrates a clear understanding of operational and financial constraints. The Georgia facility and pilot energy projects in Oman and Indonesia are early steps toward this vision.

Conclusion: A High-Conviction Play on Energy and AI Synergies

Cango Inc. represents a rare intersection of undervaluation and high-growth potential. Its disciplined CAPEX approach in Bitcoin mining, combined with an asset-light AI and HPC strategy, positions the company to capitalize on two of the most transformative sectors of the 21st century. While short-term financials remain challenging, the alignment of energy infrastructure, green computing, and distributed AI compute creates a compelling long-term narrative. For investors seeking exposure to a company with a clear path to scalability and margin improvement, Cango's current valuation offers an attractive entry point.