JPMorgan Upgrades CoreWeave to Overweight Amid Short‑Term Contracting Strategy
CoreWeave is likely to rally again as it leans into short-term contracts amid sustained cloud compute demand, according to JPMorgan. The investment bank upgraded CoreWeave to overweight from neutral on Thursday, and raised its 12-month price target by 4 %, to $125 from $120. The new target implies nearly 44 % upside from Wednesday’s close. “We are upgrading CoreWeave to Overweight from Neutral, led by the favorable pricing backdrop for compute given the strong demand backdrop as well as the incremental willingness of the company to lean into short-term contracts at premium pricing, which drives our revenue and margin forecasts higher in contrast to a lackluster share price performance dictated by investor concerns around capital intensity.” analyst Samik Chatterjee wrote in a 15-page report. CoreWeave is down 13 % in the third quarter due to concern for outsized capital expenditures to help fund the AI boom, after soaring 39 % in the first half. CRWV 3M mountain. CoreWeave is down about 13 % in the third quarter. But those investments should soon translate to financial gains, especially as CoreWeave leans into business agreements with shorter time horizons, per JPMorgan. “Relative to the favorable demand backdrop, CoreWeave also has expanded flexibility in addressing the capacity needs through shorter-term contracts relative to prior … which in our view reflects the incremental confidence from lenders in relation to the sustainability of demand” for graphics processing units, Chatterjee wrote. JPMorgan’s call matches the Wall Street consensus, where 28 of 41 analysts rate the stock a buy or strong buy, with 11 holds, LSEG data shows.
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