By Nate Wolf
It isn't a great sign for a company when investors sell their shares at the first opportunity -- which is what happened to American Bitcoin last week. Now, one firm says the stock is a Buy.
American Bitcoin stock plummeted 39% on Dec. 2 as major stockholders cashed out after the lock-up period on shares sold in a private placement in June expired. Shares have struggled to recover and are down more than 70% since their trading debut in September. The stock was down 5.4% at $1.94 on Wednesday afternoon.
But analysts at Roth Capital think the Bitcoin miner co-founded by Eric Trump has the potential for returns. The firm initiated coverage of American Bitcoin stock with a Buy rating and a $4 price target in a research note Wednesday.
Roth provided investment banking services to American Bitcoin and its partner Hut 8 over the last year, the firm disclosed in Wednesday's note. Roth is engaged to act as an underwriter for the Colombier Acquisition III special-purpose acquisition company, or SPAC, which counts Donald Trump Jr. as a board member, though that offering hasn't yet been completed. The firm also served in an advisory role for Colombier Acquisition II, which merged this year with GrabAGun Digital Holdings, a firearm retailer of which Donald Trump Jr. serves on the board.
"Roth Capital Partners discloses, according to regulatory rule, whether the firm has been compensated for investment banking services and whether it acted as a manager or co-manager for the companies mentioned in the research report," the company told Barron's in a statement. "Analysts are required, under Regulation AC, to certify on each research note that the views and opinions expressed in the report are their own."
American Bitcoin's business model is simple: The company "is purpose-built to maximize shareholder exposure to Bitcoin $(BTC)$," wrote Roth analyst Darren Aftahi.
On Wednesday, the company reported that its Bitcoin reserve had reached 4,783 tokens, after it added 416 Bitcoin in the previous week.
Bitcoin mining -- the power-intensive process of solving complex equations to mint new coins -- is one part of the model. While many miners transitioned their data centers to support advanced computing and artificial intelligence, American Bitcoin stayed focused on cryptocurrency. The company's partnership with fellow miner Hut 8 gives it access to data-center infrastructure, power, and operational support, Roth said.
The mining differentiates American Bitcoin from other so-called digital asset treasuries, or DATs, Roth argued. The traditional DAT model, popularized by Strategy, involves issuing equity and debt to accumulate as much crypto as possible.
Roth said that if mining remains profitable, adding that it's possible under the right conditions, American Bitcoin can generate real cash flow, unlike its competitors without operating businesses. The company can then purchase Bitcoin on the open market only when the economics make sense, the firm said.
"We believe ABTC can compound its BTC holdings and increase its liquidity faster than peers due to its unique operating structure, access to capital, and supportive mining business when compared to pure-play treasury companies," Aftahi wrote.
Roth forecasts that American Bitcoin's holdings will reach around 26,000 coins by the second half of 2027 through a mix of mining and purchases.
Eric Trump, President Donald Trump's younger son, is chief strategy officer at American Bitcoin. His brother, Donald Trump Jr., is also significant investor. Being backed by the Trumps means strong awareness and potentially greater access to capital, Roth argued.
Only a handful of analysts cover American Bitcoin, and none of the analysts tracked by FactSet cover Trump Media & Technology Group. Roth is the only firm covering GrabAGun.
Shares of Trump Media, the parent company of Truth Social, are down 67% this year. Trump Media went public in 2021 through a SPAC merger underwritten by EF Hutton.
The crypto treasury ALT5 Sigma, which has a partnership with Trump family-founded World Liberty Financial, received two notices from the Nasdaq Stock Market last week saying the company wasn't in compliance with the exchange's listing requirements.
"Alt5 is actively addressing these issues to comply with Nasdaq rules," the company said in a statement.
Write to Nate Wolf at nate.wolf@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
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December 10, 2025 17:01 ET (22:01 GMT)
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