CRWV Stock On Track For 4-Day Slide Amid CoreWeave’s Debt Test: Analysts Split On Whether Selloff ‘Grossly Overexaggerated’

• Creditsights analyst Paul Meeks maintains a positive outlook on CoreWeave, citing strong fundamental growth.
• Deutsche Bank also sees the recent decline as excessive. 
• However, Mizuho cut its price target on CRWV stock to $88 from $115.

CoreWeave (CRWV) shares were on track to slide for the fourth consecutive day in early morning trade on Thursday after its bond yields spiked this week, and analysts disagree on how much it matters. 

Head of Technology at Creditsights, Paul Meeks, recommended the stock and called the selloff overdone, in an interview with CNBC. Deutsche Bank echoed that view, stating it was struggling to find any “company-specific factors” to justify the drop in share price.

Meanwhile, Jordan Chalfin, who’s the Head of Technology Research at Freedom Capital Markets, said funding has become much harder and Coreweave is currently facing fundamental risks. Mizuho also cut its price target on CRWV stock to $88 from $115.

CRWV Stock On Track For 4-Day Losing Streak

CRWV stock fell nearly 7% in pre-market trade on Thursday, after a massive drop of over 15% in the previous session, with retail traders on Stocktwits citing the firm’s outsized borrowing as the primary cause of concern.

Shares of Nebius (NBIS) fell 10% and Oracle (ORCL) shed over 8%. The Nasdaq closed down 1.9%. In the latest quarter, CoreWeave raised more than $10 billion in unsecured debt and convertibles, plus a $3.1 billion term loan. 

The most recent drawdown was also pressured by Tesla (TSLA) and SpaceX (SPCX) CEO Elon Musk stating “Yikes” in response to investor Chamath Palihapitiya’s X post, warning about CoreWeave’s surging bond yields. 

CoreWeave’s Financing Costs Raise Concerns

Chalfin noted that CoreWeave has around $40 billion in debt, while consensus estimates point to roughly $80 billion in spending over the next three and a half years. With yields on its unsecured bonds near 16%, “financing their ambitious growth plans is becoming increasingly challenging.”

Chalfin also flagged the risk of overbuilding, noting that CoreWeave has about 1.5 gigawatts of active power capacity and plans to increase that to more than 8 gigawatts by 2030. According to him, a weakness in demand could leave the company with excess capacity and a large debt burden.

Moreover, he noted, Coreweave’s initial customer contracts are set to expire after five years, and major customers such as Microsoft (MSFT) and Meta Platforms (META) could eventually build or lease more of their own computing capacity rather than renew agreements with the company.

Chalfin said he prefers Oracle (ORCL) to CRWV, because the former is an investment grade stock with lower operating expenses relative to sales. ORCL stock was down as much as 1.8% in pre-market trade. On Stocktwits, retail sentiment around the shares fell to ‘extremely bearish’ from ‘bearish’ territory over the past day.  Meanwhile, sentiment around CoreWeave shifted higher, to ‘bullish’ from ‘neutral’ territory.

CoreWeave Bull Sees Revenue Reaching $43 Billion

Meeks recommended buying CRWV stock when it traded in the $70s and said the recent sell-off has gone too far. “I do think that this has been grossly overexaggerated on the downside by both credit investors and stockholders,” he said.

Meeks added that his model projects revenue rising from about $5 billion in 2025 to $43 billion in 2028, alongside $29 billion in earnings before interest, taxes, depreciation and amortization (EBITDA). That would represent an EBITDA margin of 67%, while his model puts the operating margin at 16%.

Meeks said he is more concerned about construction risks than near-term financing. He also noted that worries in the credit market can spill over into equities, pulling down companies across the neocloud sector even when their individual business outlooks differ.

In addition to CRWV stock, Meeks also recommended NBIS, IREN (IREN) and Applied Digital (APLD). He rates Flex (FLEX) a ‘Buy’, citing plans to spin off its AI infrastructure business in early 2027.

NBIS stock fell over 3% in pre-market trade and was among the top trending tickers on Stocktwits alongside CRWV. Retail sentiment around the neocloud fell to ‘bearish’ from ‘neutral’ territory over the past day. 

Meanwhile, APLD stock was down over 6% in pre-market trade and IREN stock dropped almost 4%. FLEX stock fell around 3%. IREN was the only company to see retail sentiment in the ‘bullish’ zone. Sentiment around APLD and FLEX trended in ‘bearish’ territory over the past day. 

Deutsche Bank Says Sell-Off Is Overdone

Deutsche Bank also sees the recent decline as excessive. In a note to investors, the firm maintained a ‘Buy’ rating on CoreWeave and a $150 price target, implying about 128% upside from Wednesday’s closing price.

“A confluence of factors appear to have led to a sharp selloff in CoreWeave’s public equity and debt over the past week,” analyst Brad Zelnick said in a Wednesday note to clients. “There’s no doubt CoreWeave’s future is tied to the success of AI and demand for the underlying compute infrastructure supporting it, and thus its shares should reflect changes in sentiment here. Beyond that, we struggle to find company specific factors that justify the recent move.”

CRWV stock has fallen around 8% this year and over 50% in the last 12 months. 

Read also: Netflix Is Reportedly Cutting 1,000 Jobs – Co-CEOs Say Company Must Be ‘Disciplined’ With Resources

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