CoreWeave experienced an early uptick in its shares, climbing more than 4% in pre-market trading following analyst upgrades from DA Davidson and Deutsche Bank. Both firms moved the company to Buy, framing their decisions around stronger visibility on demand for AI compute and the potential for revenue growth beyond the company’s present contract book.
DA Davidson upgraded CoreWeave from Neutral to Buy and raised its price target to $110 from $68. The firm argued that a number of potential de-risking events are increasingly likely to occur in 2026, which could alter investor sentiment toward the stock. DA Davidson said investor worries have centered on counterparty exposure, the company’s capital structure and the realization of backlog, and that these concerns have constrained any sustained re-rating despite robust demand for AI compute.
The broker noted specific scenarios that could change the outlook. One is if OpenAI secures sufficient funding to meet its commitments to CoreWeave, a development that would reduce perceived backlog risk and could improve the company’s financing terms. DA Davidson also observed that a lower interest rate environment would ease CoreWeave’s cost of capital, though it characterized the timing of such a shift as uncertain. With the stock trading at roughly 1x backlog, DA Davidson said market prices already reflect pessimistic assumptions about execution and growth, implying limited downside relative to possible upside should the identified risks abate.
Deutsche Bank likewise raised its view to Buy and assigned a $140 price objective. The bank described the medium-term fundamentals as solid heading into CoreWeave’s fourth-quarter results and the company’s first full-year guidance as a public company. Deutsche Bank said it expects consensus revenue forecasts for 2026 to move higher if CoreWeave delivers the capacity it has planned for contracted customers.
Among the tangible advantages Deutsche Bank highlighted is more than 1 gigawatt of secured power that remains available for new contracts in what the bank described as a supply-constrained market. That available capacity, the bank said, positions CoreWeave to capture additional bookings over the coming quarters. Deutsche Bank also pointed to a growing mix of investment-grade customers, which it expects to help lower incremental financing costs even as sentiment in AI-related credit markets remains weak.
In addition, Deutsche Bank underscored a recent announcement with Nvidia as supportive of the longer-term outlook. The bank said the tie-up could enable faster capacity expansion, deeper technical integration with future Nvidia platforms and potential software opportunities linked to CoreWeave’s infrastructure management tools.
What this means going forward
- Analyst upgrades highlight a shifting investor focus from headline risks toward operational execution and capacity delivery.
- Near-term stock performance may hinge on the company’s upcoming quarterly results and the clarity provided in its first full-year guidance as a public company.