The artificial intelligence (AI) revolution is driving unprecedented demand for energy-intensive data centers. The International Energy Agency projects that data centers may account for up to one-third of the anticipated increase in U.S. electricity demand through 2026.

Major tech companies, like Microsoft, Amazon, and Alphabet, are racing to secure clean energy power sources, such as nuclear energy, to meet their mounting energy needs. One under-the-radar company with established renewable infrastructure is uniquely positioned to capitalize on this accelerating trend.

TeraWulf (NASDAQ: WULF) operates Bitcoin (CRYPTO: BTC) mining facilities powered by approximately 95% zero-carbon energy sources, primarily hydroelectric power. The company’s revenue surged 130% year over year to $35.6 million in the second quarter of 2024, driven by an 80% increase in operational mining capacity and higher Bitcoin prices.

Moreover, TeraWulf has significantly strengthened its financial position by eliminating its debt ahead of schedule. This clean balance sheet positions TeraWulf to fund its ambitious expansion plans in both cryptocurrency mining and AI infrastructure.

TeraWulf is leveraging its existing clean energy infrastructure to enter the high-performance computing and AI market. The company has already completed a 2.5 megawatt (MW) proof-of-concept project designed for next-generation graphics processing unit (GPU) technology.

Additionally, construction is underway on a 20 MW colocation facility engineered to support AI workloads. The facility includes advanced features, like liquid cooling and redundant power systems typical of premium data centers. It is scheduled to kick off operations in Q1 2025, according to the company.

TeraWulf recently secured $425 million through a convertible note offering at a reasonable 2.75% interest rate, reflecting strong institutional investor confidence. The company plans to use these funds for strategic acquisitions and the expansion of data center infrastructure to support its AI computing initiatives.

Furthermore, TeraWulf’s board recently authorized a $200 million share repurchase program through December 2025, signaling management’s belief that the stock may be undervalued despite rising approximately 165% year to date.

TeraWulf’s clean energy resources give it a unique edge in the rapidly growing AI infrastructure market. Major tech companies are actively seeking sustainable power sources for their energy-intensive AI operations, making TeraWulf’s zero-carbon data centers particularly attractive.

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I want to become financially independent. My core strategy is to grow my passive income so that it will eventually cover my recurring expenses. To reach that goal, I’m taking a multipronged approach that includes investing in dividend stocks, exchange-traded funds (ETFs), and real estate.

I’m loading up on several dividend ETFs to grow my passive income, including JPMorgan Nasdaq Equity Premium ETF (NASDAQ: JEPQ), SPDR Portfolio High Yield Bond ETF (NYSEMKT: SPHY), and iShares Core U.S. Aggregate Bond ETF (NYSEMKT: AGG). Here’s why I like this trio for passive income.

JPMorgan Nasdaq Equity Premium ETF takes a unique approach to generating income. The fund writes out-of-the-money call options on the Nasdaq-100 Index. That strategy generates options premium income each month that the ETF distributes to investors.

That income has really added up over the past year. The ETF’s dividend yield over the last 12 months is 9.5%. That’s a higher yield than U.S. high-yield junk bonds (7.9%) and the U.S. 10-year Treasury bond (4.4%). However, the payments do ebb and flow based on the options premium income the fund generates, which fluctuates with volatility.

In addition to income, this fund offers price appreciation potential. The ETF also holds a portfolio of stocks the managers select based on data science and fundamental research. The fund’s price rises as that equity portfolio’s value increases. Because of that, the fund offers the best of both worlds: high income and upside potential.

SPDR Portfolio High Yield Bond ETF provides exposure to the high-yield (junk) bond market. These bonds have sub-investment-grade bond ratings because the companies issuing this debt have weaker financial profiles. That puts these bonds at high risk of default.

This fund holds a large basket of these bonds (over 1,900) diversified across sectors, issuers, and maturity. That diversification helps reduce the default risk. If an issuer defaults on its bond, it won’t have a major impact on the ETF. Meanwhile, even if a severe market downturn negatively impacted financially weaker companies, the overall diversification of the fund should help mute the impact on ETF investors.

Investors get paid well to assume the higher risk profile of these bonds. The fund has a distribution yield currently above 7%. While the monthly distribution payments fluctuate based on interest payments received, the fund offers a relatively steady passive income stream.

The iShares Core U.S. Aggregate Bond ETF focuses on the other side of the bond market: investment-grade bonds. These bonds have a lower risk of defaulting, making them ideal for those seeking a very low-risk income stream.

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One of the biggest sensations fueling the healthcare space right now is the medication class of glucagon-like peptide-1 (GLP-1) agonists. Even if you aren’t familiar with the term “GLP-1,” you’ve probably heard of Ozempic and Wegovy. Both medications are GLP-1 agonists, used to treat diabetes and obesity, respectively.

These treatments have become blockbuster drugs for their maker, Novo Nordisk, and have helped fuel generous gains for investors in the stock. While Novo Nordisk currently dominates the GLP-1 industry, a number of other players are looking to enter the space.

One leading entrant is Viking Therapeutics (NASDAQ: VKTX). Below, I’ll break down where Viking stands in its pursuit of the weight loss market, and assess whether buying the stock could be like investing in Novo Nordisk at the beginning of the Ozempic revolution.

Viking has several drug candidates in its pipeline. But the one that investors seem most honed in on is VK2735 — a dual GLP-1 and GIP receptor agonist focused on treating obesity. As a dual agonist, VK2735 could wind up being a more optimal treatment for obesity and diabetes than single-pathway GLP-1 medicines such as Ozempic or Wegovy.

In late October, Viking announced that it will be meeting with the Food and Drug Administration (FDA) during the fourth quarter, about the proper steps and protocols to move VK2735 into a phase 3 clinical trial.

Given the information above, you might think buying Viking stock now — prior to phase 3 trials — is a lucrative opportunity. However, there is quite a bit to consider besides anecdotal updates about VK2735.

So far in 2024, shares of Viking have rocketed by a whopping 323% — putting its market cap right around $8.8 billion. Considering that the company doesn’t generate revenue, it’s hard to justify this valuation.

On the bright side, I think Viking is in a pretty solid financial position.

At the end of the third quarter, it boasted $930 million of cash and equivalents on its balance sheet. Furthermore, the company has spent roughly $105 million in operating expenses through the first nine months of the year. This implies an annual run rate of approximately $140 million in spending on research and development (R&D) and other administrative expenses, suggesting that Viking has ample liquidity to continue funding its operations.

I see Viking Therapeutics as largely a speculative opportunity. While data from its clinical trials so far have been encouraging, there are still plenty of unknowns surrounding the phase 3 study.

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SoFi Technologies (NASDAQ: SOFI) has done an excellent job expanding its customer base and growing revenue. However, it has contended with sluggish loan growth in the high-interest rate environment, leading to investor skepticism about its short-term prospects. As a result, the stock remains 62% below its all-time high price in 2021.

However, the company has found multiple levers for growth and is seeing encouraging progress in its nonconsumer business. If you’re considering buying SoFi today, here’s what you should know.

In its early days, SoFi focused on helping people refinance their student loan debt. Then in 2020, the pandemic and policies around student loan forbearance forced SoFi to reevaluate its business. One area that helped drive its ongoing growth was personal lending. From 2020 to 2023, SoFi’s personal loan originations grew from $2.6 billion to $13.8 billion.

The higher-interest rate environment of the past couple of years has been a double-edged sword for SoFi. On one hand, consumers have had to grapple with higher interest rates, which could make it harder for them to pay down their debts.

In the second quarter, SoFi charged off $151.8 million in personal loans, giving it a charge-off ratio of 3.84% on its $15.9 billion personal loan portfolio. This is up from 2.94% one year ago and is one metric that investors have kept a close eye on. Charge-offs have risen across the banking sector over the past couple of years, which many attribute to normalizing conditions rather than systemic weakness across the consumer.

Additionally, SoFi projects that its lending segment revenue will decline 5% to 8% compared to last year. CEO Anthony Noto told investors during the first quarter that the fintech is taking “a more conservative approach in light of macroeconomic uncertainty.”

Conversely, higher interest rates have helped SoFi grow its net interest income significantly. One big reason for this was its 2022 acquisition of Golden Pacific Bancorp, which enabled SoFi to hold deposits and thus, more loans on its books. Since acquiring the bank, its total deposits have grown to nearly $23 billion, thanks to its high-yielding savings accounts offering an annual yield of up to 4.5%.

Last year, SoFi brought in almost $1.3 billion in net interest income, up over 400% from 2021. This solid growth continued through the first half of this year, with its net interest income increasing 55% to $815 million.

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SoFi’s banking business is steadily growing, but what excites me is the potential of its technology platform. In recent years, the company has made substantial investments in Galileo and Technisys to develop a robust technology infrastructure aimed at bringing banking services to nonbank companies.

Galileo serves as the backend infrastructure for fintech companies without banking charters, enabling them to handle payments and offer various banking services through SoFi.

Meanwhile, Technisys replaces outdated legacy systems, which hindered rapid innovation, and it can simultaneously support multiple products, run in the cloud, and allow banks to process and analyze data in real time. With this powerful technology stack, SoFi aspires to become the “Amazon Web Services (AWS) of fintech.”

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SoFi’s technology platform has evolved into a significant business and can provide stability thanks to long-term contracts. In the first half of this year, the technology platform generated net revenue of $190 million, marking a 15% increase from the previous year, and boasted a robust contribution profit margin of 33%.

On Oct. 14, SoFi announced a $2 billion loan platform business agreement for personal loans with funds managed by Fortress Investment Group. Noto said in a press release that the agreement will help it “diversify toward less capital-intensive and more fee-based sources of revenue.” The agreement shows investors’ risk appetite for SoFi’s loans may be returning after skepticism over the abovementioned rising charge-offs.

SoFi has done an excellent job growing its banking presence and increasing its deposit base rapidly over the past few years, and its earnings continue to improve as it pulls on multiple growth levers across its business. The company has done an excellent job of adding customers and improving the economics of its business over the past several years. This is why I think the stock is a solid buy for long-term investors today.

Before you buy stock in SoFi Technologies, consider this:

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The 2008 financial crisis exposed numerous flaws in America’s financial system, such as the inherent danger of America’s largest banks being overleveraged. Significant dangers remain despite a slate of reforms designed to keep banks on sound financial footing going forward. A recent article in Cryptopolitan magazine revealed that American banks’ potential loss exposure on real estate-related securities skyrocketed to $750 billion in Q3 2024.

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This is raising concerns for many reasons. First, the estimated $750 billion is roughly seven times more than banks held in 2008. Second, many unrealized losses are concentrated in portfolios that are crucial to bank profits. The most at-risk portfolios are:

·      AFS-Available for sale

·      HTM-Held to maturity

One deeply troubling aspect of the potential $750 billion in losses is that so much is tied to residential mortgage-backed securities (RMBS). Banks loaded up on these when interest rates were lower. The easy credit made it easier for banks to acquire larger debt tranches and the underlying assets were also easier to sell. Making such heavy investments in RMBS now threatens to boomerang back on banks and investors in a big way.

Many of those HTM portfolio loans are approaching maturity dates and high interest rates are slowing sales down in the AFS portfolios. That’s why the potential losses are beginning to stack up. Increased financing costs are consuming massive chunks of what used to be profit and Investors are wary of buying RMBS in the current environment.

This decreases the value of bank-held RMBS while increasing the potential losses on the underlying assets. Being upside down on large AFS or HTM portfolios has taken banks down. In 2023, unrealized losses on First Republic Bank’s commercial loan portfolios were a major contributor to the bank’s eventual collapse and takeover by JP Morgan Chase.

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Banks may have been able to carry these balances in years past, but one of the major reforms instituted after 2008 is making that much more difficult. U.S. banks must submit to periodic “stress tests” where their liquidity is weighed against outstanding debt and liabilities. If those numbers are out of line, the bank could be forced to close or make major markdowns.

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