WhiteFiber Inc.: B. Riley Adjusts Price Target Amid Execution Progress
B. Riley has recently revised its price target for WhiteFiber Inc. (NASDAQ: WYFI) from $44 to $40, while still maintaining a Buy rating. This adjustment comes in light of updated assumptions related to the company’s first long-term co-location agreement, a significant development that underscores WhiteFiber’s strategic direction and operational capabilities.
Long-Term Co-Location Agreement Insights
The announcement of WhiteFiber’s inaugural long-term co-location agreement at the NC-1 data center campus with Nscale Global Holdings marks a pivotal moment for the company. Although the finalization of this agreement took longer than initially anticipated, B. Riley noted that WhiteFiber’s reaffirmation of its original deployment timeline highlights its robust execution capabilities. This development not only validates the company’s retrofit-based development model but also positions it favorably within a competitive market that increasingly relies on data-centric infrastructure.
Financial Outlook and Construction Financing
Looking to the future, WhiteFiber has revealed that it is currently engaged in advanced discussions with multiple lenders regarding a construction financing facility. This facility is expected to feature an accordion-style structure, which allows for increased flexibility in borrowing. The targeted completion date for this financing is set for early first-quarter 2026. Furthermore, management has indicated that potential credit enhancements could significantly minimize overall funding costs, especially with enhanced clarity on ultimate off-takers. Such financial maneuvers indicate a strategic approach to capital management that could bolster WhiteFiber’s growth trajectory.
Capacity Expansion and EBITDA Forecasts
B. Riley emphasizes that the upcoming capacity, anticipated to come online in under two quarters, supports WhiteFiber’s speed-to-market thesis. This is crucial as the company seeks to expand its footprint across multiple sites, thereby increasing its market share and service offerings. However, B. Riley has made modest reductions to its EBITDA forecasts to reflect the updated deployment timing and more conservative assumptions in Cloud Services. Specifically, the second-quarter 2026 EBITDA estimate has been lowered from $19.5 million to $17.9 million, while the full-year 2026 EBITDA is now projected at $92.7 million, down from $99.5 million.
Valuation Analysis
Currently, WhiteFiber is trading at approximately 11 times EV/EBITDA based on 2026 estimates, and around 8 times EV/EBITDA on a fourth-quarter 2026 run-rate basis. These figures represent a notable discount compared to peer valuations, which tend to range in the mid- to high-teens. This disparity suggests that WhiteFiber may offer significant upside potential for investors, especially if the company successfully executes its growth strategy and capitalizes on its current agreements.
Conclusion: A Buy Opportunity?
In summary, while B. Riley’s price target adjustment reflects updated market assumptions and operational timelines, the fundamental progress made by WhiteFiber, particularly with its co-location agreement and strategic financing discussions, points to a resilient and potentially lucrative investment opportunity. As the data center market continues to expand, driven by increasing demand for cloud services and data storage, WhiteFiber’s execution capabilities and strategic initiatives will be critical in determining its success moving forward.
