Should you sell your Galaxy Digital stock?

ATB Securities analyst Martin Toner maintained his “Outperform” rating and $50.00 target on Galaxy Digital (Galaxy Digital Holdings Stock Quote, Chart, News, Analysts, Financials TSXV:GLXY) in an August 5 flash note, following the company’s second-quarter results.

Before open on August 5, Galaxy reported Q2/25 revenue of $8.6-billion, missing consensus of $12.6-billion and down 2.5% year over year. Net income of $30.7-million also fell short of the $83.0-million consensus. Adjusted gross profit was $299.2-million, roughly in line with expectations, and shareholder equity came in ahead of ATB’s forecast at $2.62-billion. Toner also pointed to Galaxy’s announcement that CoreWeave exercised its final option in Q3 to access an additional 133 MW of IT capacity at the Helios facility.

“The additional capacity comes at similar terms to the previously announced 15-year, 133 MW lease agreement from March 28, 2025,” he said. “With this expansion, CoreWeave has now committed to the full 800 MW of gross power that is currently approved at Helios. With the acquisition of land and a 1 GW interconnect request, Helios now has 3.5 GW of potential power capacity, while all construction is progressing on schedule, according to management, which we view constructively. Once adjusting for a $125.1 mm loss on a derivative related to notes payable, we believe GLXY’s underlying profitability in Q2/25 was quite strong, reflecting GLXY’s ability to perform well in choppy digital asset markets.

“We believe these results and the upsizing of the CoreWeave deal should be well received by investors.”

Toner said management struck an optimistic tone on the conference call, highlighting several positives, including record performance in July, the strongest month in the company’s history. He also noted that Galaxy now hosts $2-billion in digital assets across 20 clients using its “treasury strategy” platform.

“Galaxy intends to service these companies with lending, staking and other solutions,” he said. “The company announced adjusted EBITDA for the first time. EBITDA of $211.2mm, excludes the $125mm derivative loss, and according to the company, is a good measure of the company’s underlying profitability going forward. According to Galaxy, data center growth ‘will be a function of executional excellence and company growth’ to support further data center expansion.”

Galaxy Digital reported $8.9-billion in assets, up 27% quarter over quarter, with assets under stake rising 34% to $3.15-billion. The loan book expanded to $1.1-billion from $874-million in Q1.

Digital assets adjusted gross profit increased to $71.4-million from $64.7-million, while Adjusted EBITDA turned positive at $211-million, compared to a $290-million loss in the prior quarter.

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