2 min read
CoreWeave (CRWV) has at least one fierce fan on Wall Street at this precarious time.
“We are increasing our revenue growth estimates for CoreWeave from 102% and 58% in 2027 and 2028 to 105% and 63%, respectively, driven by our assumptions for active power and prices. We expect the company to add 1.4-1.5GW of power annually in FY27 and FY28, and assume higher revenue per megawatt (MW), increasing from ~$10 currently to $14 by year end 2028, on the back of Vera Rubin deployments,” BofA analyst Tal Liani said in a note on Thursday.
Liani set a $140 price target on the stock, estimating a 122% surge from current levels.
“We believe CoreWeave’s greatest competitive advantage is its ability to bring active power online at scale,” Liani said. “In 2Q26, the company added 500MW of active power and is targeting 8GW of power by YE2030. The associated risks are controlled in multiple ways. The company primarily leases data center capacity from a diversified set of third-party developers (rather than build data centers). It signs back-to-back deals between infrastructure providers and customers, and often gets 50% pre-payments and pledges their Tier One customers balance sheet as collateral for the loans.”
Heavily indebted AI player CoreWeave is having an awful week that keeps getting worse.
CoreWeave stock plunged 6% in premarket trading on Thursday following a 15% rout on Wednesday.
65.78 -12.03 (-15.46%)
At close: October 14 at 4:00:01 PM EDT
62.50 -3.28 (-4.99%)
Pre-Market: 9:22:21 AM EDT
Two factors collided to spark Wednesday’s sell-off.
One, CoreWeave’s corporate bonds across maturities continued to be dumped amid fears of an AI slowdown and what that would mean for the company’s precarious balance sheet.
The rise in yields on CoreWeave’s bonds even spurred Elon Musk to post “Yikes” on X in response to a post by venture capitalist Chamath Palihapitiya.
Two, Gartner, in a new report, forecast that by 2030, “cost pressure and a lack of a differentiating business model will force over 80% of neocloud providers to cease independent operations.”
CoreWeave is a neocloud. The report was essentially akin to yelling “fire” in a crowded theater.
Brian Sozzi is Yahoo Finance’s Executive Editor, host of the Sozzi Unleashed morning show and the Power Players with Brian Sozzi podcast, and a member of Yahoo Finance’s editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.
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