Narrative on CoreWeave Should Flip, Benefit from AI Sentiment

Dow Jones00:29

1229 ET - Investor concerns around CoreWeave's leverage and credit risk are likely peaking, and the company should benefit from a positive inflection in the Street's sentiment around AI, UBS analysts write in a note, initiating coverage with a buy rating. The rating sets UBS apart from consensus, the analysts concede, but they argue that investors are underrating GPU pricing trends, the durability of compute demand, and CoreWeave's positive reputation within the tech industry. "A positive call on CoreWeave shares is a de facto call that investors will soon rotate back into the long-AI trade, a scenario that seems increasingly likely given the muted sentiment, strong demand signals and reported frontier lab growth," the analysts write. Shares are up 1.7%.

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