TeraWulf (WULF) stock is in focus after the Kentucky Public Service Commission approved a Retail Electric Service Agreement supporting up to 482 megawatts for the company's Justified Data Campus in Hancock County.

Against this backdrop, TeraWulf's share price has been volatile, with the stock down 6.91% over the last session and 42.05% over 90 days, yet still showing a 20.49% year to date share price gain and a 1 year total shareholder return of 62.43%. This suggests longer term momentum has been stronger than recent trading implies.

Compare TeraWulf's power hungry AI and data center story with other potential beneficiaries of rising computing demand by scanning our hand picked list of 56 AI infrastructure stocks.

TeraWulf's pullback after the Kentucky power approval and recent insider selling can be read as a rethink of the story or simply a sentiment swing. That matters before weighing where the stock sits on valuation.

Most Popular Narrative: 59.5% Undervalued

The most followed TeraWulf narrative puts fair value at $37.94 per share versus the last close at $15.35. That gap is built on an ambitious long term digital infrastructure plan.

TeraWulf's recent multi-billion-dollar, multi-year hyperscale hosting agreements (e.g., with Fluidstack and Google), mark a significant shift from a pure bitcoin mining model toward diversified, contracted revenue streams in high-demand digital infrastructure, this underpins higher revenue visibility and insulates earnings from bitcoin price volatility.

Read the complete narrative.

Want to see how this shift from crypto mining to long duration AI and HPC leases underpins that valuation gap? The most widely followed narrative leans heavily on rapid revenue expansion, rising margins and a premium future earnings multiple to bridge today's losses with a much larger, contracted cash flow base.

Result: Fair Value of $37.94 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this TeraWulf narrative could be challenged if high capital needs strain the balance sheet, or if key AI tenants such as Anthropic and Fluidstack fail to deliver.

Find out about the key risks to this TeraWulf narrative.

Another View: What TeraWulf's Current P/S Ratio Implies

The popular TeraWulf narrative leans heavily on long term contracts and growth forecasts. Our multiples check paints a very different picture. The stock trades on a P/S ratio of 46.4x, versus about 4x for the wider US Software industry and 19.8x for peers. The fair ratio sits near 19.6x, so the current gap signals a lot of expectation already in the price. How comfortable are you with that kind of valuation stretch if the growth story stumbles?