TeraWulf data center stock climbs after New York data center moratorium announcement creates contrarian investment opportunity.

Shares of TeraWulf (WULF) recovered on Wednesday after an early decline, as Wall Street analysts argued the market had overreacted to New York's new data-center moratorium.

New York imposed a one-year pause on new data centers larger than 50 megawatts, triggering a sharp selloff in WULF shares on Tuesday. The stock fell 7% that day, then dropped another 4% early Wednesday before rebounding approximately 3.75% in afternoon trading and finishing up 1.9% by Wednesday afternoon.

Despite the initial market reaction, analysts maintained bullish ratings and characterized the policy as presenting limited operational risk to TeraWulf. Cantor Fitzgerald said the weakness presented a buying opportunity, noting that TeraWulf's existing leases remain unaffected by the policy. The firm added that the value of the company's contracted leases exceeds its current market valuation. Cantor Fitzgerald reiterated its Overweight rating and $37 price target, implying upside of nearly 91% from Tuesday's close.

Rosenblatt reaffirmed its Buy rating and $30 price target, suggesting around 55% upside. The firm noted that TeraWulf should be largely exempt from the policy, with the majority of its power footprint now located outside New York. Rosenblatt characterized the selloff as reflecting "more headline risk than structural risk," pointing out that the enforcement mechanism "simply doesn't reach the company's existing NY platform."

Needham also reiterated its Buy rating and $33 price target—implying 70% upside—stating that the company's Lake Mariner site would not be affected by the moratorium.

TeraWulf is uniquely exposed to New York's decision, as its Lake Mariner data-center campus and its under-development Cayuga site are both located in the state. Governor Kathy Hochul ordered the moratorium on Tuesday.

On Stocktwits, retail sentiment for WULF remained extremely bullish, while message volume was high. Over the past 30 days, message volume surged 206%, while the ticker's watcher base rose 7.6%, indicating steady growth in retail interest. Year-to-date, WULF stock has surged nearly 70%.