Hi Travis and everyone,
Just wondering if anyone else is in $SLNH? I searched and did not find anything.
I feel like this company will be a gold mine or actually a crypto mine but was wondering what others thought. Travis I feel like this is one for the LockBox. I buy to hold 3-7 years and target 2x to 10x in that time frame. I feel like this one has a great chance of performing well. They issue monthly financials and are scaling at a tremendous rate. They are small $138M market cap. Their primary business is to market utilities as a green energy absorber. They have a legacy instruments business that they have an interested buyer for which will just add additional cash to expand. They will take all excess energy, at a good price, and use it. They build small format, highly scalable data centers and use the energy for batch processing. Right now that is mining crypto that they immediately sell to finance rapid expansion. In July of 21 they were at 22 PetaHash/sec and the next few months saw there PH/s capability grow to 61 PH/s, 125, 316, 403, 587, 616, 734 est for Feb 22 and 1,000 PH/s(1 EH/s) by March 31st and over 2 EH/s by Sept 30 2022. They are presently mining crypto as there is no sales force required but believe there is a large TAM available in batch processing for universities, research centers, financial institutions etc.
They are especially transparent as to what they are doing other than some secrecy around locations as they are working deals. I have figured out several of them, the first two are buying excess energy from the TVA dams. The next couple I believe are at Utility solar locations. The dams are a better deal because the utility just directs more water to the turbines so you can operate 24/7-365. Solar and wind have less reliability.
I do not try to sell companies I just put the idea out there and if you are interested in them or not I would be curious as to why. I am not afraid to cut it lose if I have missed something. That said, I feel like this is a brilliant solution to the utility’s problem of how to use all the curtail green energy and solves one of the big objections to crypto since all energy used is green.
https://www.solunacomputing.com/ Disclosure I am very long $SLNH at double my usual capital allocation.
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Sounds like a cool idea, though that’s effectively what a lot of the crypto miners and data center operators are doing as well, by locating in areas with lots of cheap renewable energy (particularly the hydroelectric dams of the Pacific Northwest). I have never looked at them before, but my first question would be about whether there’s going to be enough profit margin at scale for them to essentially do this energy arbitrage as the market grows larger and more efficient. I don’t have a good handle on how sustainable that arbitrage may be, but when it comes to balancing green energy and the electric grid in any meaningful way they are almost unimaginably small at this point, and we’d probably have to dig pretty deep to try to guess at how much of their financial performance in recent quarters represents a sustainable business in energy arbitrage, and how much is just coming from the volatility of bitcoin prices.
I have spent quite a bit of time on it and feel like the numbers work in their favor and the investors. Their goal is to scale quickly and they look to be a cash machine. Around here there is lots of unsold hydro potential and utility grade solar going in without storage or any way of smoothing it out. Perfect for them. As my growth stocks plummet and this grows it is becoming a relatively large holding for me. Was hoping other sets of eyes on it might yield more conviction or overlooked risk.