TeraWulf (WULF) acquisition of a 1-gigawatt data-center site in eastern Kentucky lifts its total development inventory to 3.8GW and reflects a creative structure backed by American Electric Power (AEP) that introduces regulatory and construction complexity, Oppenheimer said Tuesday in a report.

A new customer for TeraWulf's 400-megawatt western Kentucky site is expected to be announced soon, with that location potentially expanding by another 1GW, the report said. At 3.8GW of capacity, TeraWulf trades at about $4 million per megawatt versus peers at roughly $5 million, and Oppenheimer estimates each megawatt could generate $10 million in equity value once completed.

TeraWulf is targeting 500MW by H2 2028 and the remaining 500MW by H2 2030 at the new eastern Kentucky site, with AEP guaranteeing power delivery, Oppenheimer said. Capital needs and construction execution remain the primary risks, the report said.

Oppenheimer maintained its outperform rating on TeraWulf stock with a $35 price target.

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