Goldman Sachs Starts Galaxy Digital (GLXY) at Neutral

Goldman Sachs analyst James Yaro initiates coverage on Galaxy Digital (NASDAQ: GLXY) with a Neutral rating and a price target of $30.00.

The analyst comments: "GLXY is a business in transition, moving from its roots as a pure play digital assets investment and merchant bank to providing AI data center infrastructure as well. Two of its three businesses remain within digital assets: 1) its Digital assets investment bank & asset manager; and 2) its Treasury that holds on-B/S digital asset investments, both of which grow as the crypto ecosystem expands from institutional adoption, in part driven by regulatory reform. The new Data center segment also offers a compelling vector for growth, offering long-term, robust revenue growth beginning in 2026E, and earnings in 2H28E and beyond. This growth, combined with a largely fixed lease contract, should reduce GLXY’s elevated revenue and earnings volatility, as Data centers becomes a greater part of overall business earnings, which could drive rerating over time. All in, we model 5% revenue growth from 2024-28E, and adj. EBITDA margins falling ~120bps to 66.1%, on healthy Digital assets and Data centers growth, but no assumed marks on investments in Treasury limits operating leverage."

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Shares of Galaxy Digital closed at $28.90 yesterday.

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