The drumbeat to buy battered shares of CoreWeave is growing louder on Wall Street
Analysts are saying the sell-off, which is continuing Friday, is "overblown."
TL;DR
- AI trade tanked this week due to decelerating revenue growth and accelerating AI capex, affecting neocloud companies like CoreWeave.
- CoreWeave shares are down approximately 11%, but analysts like Brent Thill at Jefferies see the sell-off as 'overdone' and maintain a $150 price target.
- Analysts note CoreWeave's increasing pricing power, even with potential expansion in debt service costs, and rising yields on its unsecured debt.
- JPMorgan also considers fears 'overdone,' highlighting robust datacenter demand and CoreWeave's capacity being pre-sold under long-term contracts.
- Other neoclouds like Nebius and IREN also saw declines, while Cantor Fitzgerald believes the market is misjudging CoreWeave's business improvements.