Why This Green Bitcoin Miner Could Be the Next Big AI Infrastructure Stock

The artificial intelligence (AI) revolution is driving unprecedented demand for energy-intensive data centers. The International Energy Agency projects that data centers may account for up to one-third of the anticipated increase in U.S. electricity demand through 2026.

Major tech companies, like Microsoft, Amazon, and Alphabet, are racing to secure clean energy power sources, such as nuclear energy, to meet their mounting energy needs. One under-the-radar company with established renewable infrastructure is uniquely positioned to capitalize on this accelerating trend.

Zero-carbon powered growth

TeraWulf (NASDAQ: WULF) operates Bitcoin (CRYPTO: BTC) mining facilities powered by approximately 95% zero-carbon energy sources, primarily hydroelectric power. The company's revenue surged 130% year over year to $35.6 million in the second quarter of 2024, driven by an 80% increase in operational mining capacity and higher Bitcoin prices.

Moreover, TeraWulf has significantly strengthened its financial position by eliminating its debt ahead of schedule. This clean balance sheet positions TeraWulf to fund its ambitious expansion plans in both cryptocurrency mining and AI infrastructure.

Strategic pivot to AI infrastructure

TeraWulf is leveraging its existing clean energy infrastructure to enter the high-performance computing and AI market. The company has already completed a 2.5 megawatt (MW) proof-of-concept project designed for next-generation graphics processing unit (GPU) technology.

Additionally, construction is underway on a 20 MW colocation facility engineered to support AI workloads. The facility includes advanced features, like liquid cooling and redundant power systems typical of premium data centers. It is scheduled to kick off operations in Q1 2025, according to the company.

Strong financial backing

TeraWulf recently secured $425 million through a convertible note offering at a reasonable 2.75% interest rate, reflecting strong institutional investor confidence. The company plans to use these funds for strategic acquisitions and the expansion of data center infrastructure to support its AI computing initiatives.

Furthermore, TeraWulf's board recently authorized a $200 million share repurchase program through December 2025, signaling management's belief that the stock may be undervalued despite rising approximately 165% year to date.

Infrastructure advantage

TeraWulf's clean energy resources give it a unique edge in the rapidly growing AI infrastructure market. Major tech companies are actively seeking sustainable power sources for their energy-intensive AI operations, making TeraWulf's zero-carbon data centers particularly attractive.

3 Superb Dividend King Stocks for Buy-and-Hold Investors

Coca-Cola (NYSE: KO), PepsiCo (NASDAQ: PEP), and Procter & Gamble (NYSE: PG) are three well-known consumer-facing companies. They are also Dividend Kings, meaning they have paid and raised their dividends for at least 50 consecutive years.

All three companies reported earnings within the last month. In those reports and earnings calls, they discussed a similar challenge that has been affecting their sales.

Here's what you need to know about the state of each business and what makes all three companies excellent dividend stocks to buy and hold now.

Sales volume woes

Coca-Cola and PepsiCo have various nonalcoholic beverage brands. PepsiCo is more diversified than Coke since it owns Frito-Lay and Quaker Oats and isn't solely focused on beverages. Meanwhile, P&G owns dozens of brands in the beauty, grooming, healthcare, fabric and home care, and other categories.

All three companies have global operations and heavily depend on international sales to drive growth. The global footprint is great for tapping into emerging markets and achieving diversification. But now, weak demand (especially in China) and unfavorable currency conversion rates have affected margins.

The biggest challenge for all three companies has been a decline in sales volumes. Sometimes, volume declines for one business can be a sign that it lacks pricing power or is losing market share to the competition. But when it is a widespread problem, like we see today, it usually means that consumer spending is in a cyclical downturn.

For the nine months ended Sept. 27, Coca-Cola reported just a 1% increase in unit case volume. In PepsiCo's third-quarter report, it posted a 2% year-to-date decline in convenience-foods volume and a 1% decrease in beverages volume.

In P&G's recent quarter, which was first-quarter fiscal year 2025, the company reported flat overall volume and a 1% increase in organic volumes. For P&G's fiscal year, ended June 30, it reported flat overall volumes, including volume declines in two key segments: baby, feminine & family care and healthcare.

Despite weak volumes for Coca-Cola, PepsiCo, and P&G, all three companies are still growing overall sales and earnings thanks to efficiency improvements, cost management, and pricing power. But prices can only be raised so much before consumers push back.

PepsiCo, in particular, is feeling the effects of taking price increases too far. As mentioned, it is seeing the worst volume declines. So to drum up demand, it has decided not to cut prices, but instead to include more product in packages on a case-by-case basis, such as adding 20% more product in Tostitos and Ruffles bags and bonus bags in variety packs.

The key takeaway is that Coca-Cola, PepsiCo, and P&G face similar issues. However, they are still generating plenty of profits to deliver on their promises to investors, especially through dividend growth.

Reliable passive income at a reasonable value

In fiscal 2025, Procter & Gamble plans to return $10 billion to shareholders through dividends and $6 billion to $7 billion in buybacks. Coke and PepsiCo don't buy back nearly as much stock as P&G, but they are developing brands.

For example, Coca-Cola bought Topo Chico in 2017 and has done an excellent job expanding its distribution and releasing new flavors. On its earnings call, it discussed why Topo Chico has helped make sparking water a standout category even in this challenging period.

Meanwhile, PepsiCo just bought Siete Foods for $1.2 billion, indicating the business is strong enough to invest in growth even as sales volumes are declining.

P&G's yield is just 2.4% compared to 2.9% for Coca-Cola and 3.1% for PepsiCo. Since dividends are just one aspect of P&G's capital return program, and it repurchases relatively more stock than Coke and Pepsi, it makes sense why its yield would be lower, and it would have a lower payout ratio at 66%, compared to 76% for the other two companies.

From a valuation standpoint, PepsiCo has the lowest price-to-earnings ratio (P/E) of the three companies, followed by Coca-Cola and then P&G. But all three companies have a lower forward P/E ratio than their five-year median P/Es, suggesting they can grow into their valuations over time.

Where Will Toast Stock Be in 1 Year?

Toast (NYSE: TOST) is a restaurant technology company with products for processing payments, taking orders, and more. And one year from now, Toast stock is likely to be trading higher than it is today.

Revenue is growing at more than 20% annually, and management is demonstrating that it knows how to run a profitable business. Those two things are encouraging enough, but there's one more thing that makes me even more optimistic about the long-term prospects of this company.

Don't overlook this adoption trend with Toast

In the second quarter, around 8,000 new restaurant locations started using Toast's technology. Admittedly, the second quarter is usually a strong one for the company, but this was a record amount of net new locations. And it answers a major question that shareholders had.

In 2023, Toast launched a new fee that outraged customers, leading management to quickly reverse the decision. But there are other restaurant technology companies out there, and shareholders were left wondering whether Toast had misstepped and alienated users from its platform.

Given the record number of net new locations in Q2, it appears Toast didn't suffer too much reputational damage. That being the case, there's good reason to believe its growth rate could accelerate.

When Toast reaches 20% market share in a specific market, management calls this a flywheel market. It seems its existing customers become brand evangelists in those flywheel areas. Simply put, the company has noted stronger adoption rates, lower expenses, and consequently, higher profits, in flywheel markets.

In 2021, Toast had 20% or greater market share in only 5% of U.S. markets. In 2023, that jumped to 31% of U.S. markets. And it continues to climb in 2024, according to management.

The company only has 13% market share in the U.S. as a whole, but more and more markets are reaching a tipping point where taking more share gets easier.

Thinking about this from a big-picture perspective, Toast appears to be on a path to claiming a huge percentage of the overall restaurant space in the U.S., meaning the business could have many years of growth ahead of it.

More than just growth

For some time, I've been a believer in Toast's growth potential. I was a doubter when it came to its bottom line, but this company is proving me wrong in real time.

Toast provides hardware devices to customers at a gross loss, and payment processing is low margin. By contrast, its software subscription products are high margin. That's great, but it takes time for the software profits to get big enough to offset the losses elsewhere in the business. However, as this chart shows, Toast's gross profit margin is jumping higher recently as revenue soars.