CoreWeave stock rating upgraded to Market Outperform by Citizens JMP

Investing.com - Citizens JMP upgraded CoreWeave (NASDAQ:CRWV) from Market Perform to Market Outperform and established a price target of $180.00. The stock, currently trading at $120.47, has shown remarkable momentum with a 20.21% gain in the past week. According to InvestingPro, the company maintains a robust gross margin of 74.46%.

The upgrade comes as Citizens JMP analyst Greg Miller sees accelerating hyperscale outsourcing in the GPU-as-a-Service (GPUaaS) market, citing Oracle’s $450 million record RPO and Microsoft’s reported $17 billion contract with Nebius as evidence of this trend.

Citizens JMP projects the GPUaaS market will grow from its current $3-4 billion to approximately $300 billion, with benefits extending "well beyond Oracle" as indicated in their update note from two weeks ago.

The $180 price target represents multiples of approximately 6.0x estimated 2027 revenue and 22.0x operating profit, which the firm notes is "well below Oracle’s, whose success is largely driven from an identical source."

Despite acknowledging "some obvious long-term flaws in the business model," Citizens JMP expects companies to diversify revenue streams around GPUaaS, which should "help mitigate structural risks and support a more sustainable long-term business model."

In other recent news, CoreWeave has entered into a significant agreement with Nvidia, as disclosed in an SEC filing. The agreement, valued at $6.3 billion, involves Nvidia purchasing CoreWeave’s cloud infrastructure, with obligations to buy any unsold capacity through April 2032. This development is expected to enhance CoreWeave’s cloud computing capacity and offerings. Additionally, Deutsche Bank has added CoreWeave to its Catalyst Call Buy Idea List, citing the high demand for AI infrastructure as a potential driver for future revenue growth. Freedom Capital Markets has upgraded CoreWeave’s stock rating from Sell to Hold following strong Q2 FY2026 results that surpassed both analyst forecasts and management guidance. The firm also increased its price target to $430.00. In another development, CoreWeave announced the launch of CoreWeave Ventures, a new initiative aimed at supporting startups in the AI ecosystem. This program will provide investment resources, technical expertise, and computing power to emerging companies.

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