CoreWeave (CRWV) Stock Jumps 157%—But Analyst Warns the Rally Looks Risky

We recently published a list of 10 AI Stocks Gaining Wall Street’s Attention. In this article, we are going to take a look at where CoreWeave, Inc. (NASDAQ:CRWV) stands against other AI stocks gaining Wall Street’s attention.

On May 27, MoffettNathanson raised the firm’s price target on CoreWeave, Inc. (NASDAQ:CRWV) to $56 from $43 and kept a “Neutral” rating on the shares. CoreWeave, Inc. (NASDAQ:CRWV) is a cloud platform provider that provides equipment for AI and other computing purposes.

The analyst noted that CoreWeave shares are up 157% since the IPO at $40, but that this rally doesn’t align with any significant changes in the company’s foundational aspects. The firm’s focus is “on fundamentals, not trading dynamics.” It further stated how “little has happened on the ground to prompt such a jump.”

It is true that the demand backdrop for AI infrastructure has been “extremely strong,” but that was the case previously, and the firm is “not inclined to simply chase the shares higher.”

The firm is cautious on CoreWeave and that ‘attempting to trade this move appears exceptionally dangerous.’

A financial professional utilizing a cloud-based software application.

For investors, this is what it means:

“Our bias is now skewed to the downside, as opposed to being quite balanced in our initiation, but attempting to trade this move appears exceptionally dangerous,” Del Deo said in a Monday note to clients.

The firm has noted that the risks of moving to a sell call would “remain far higher than we feel comfortable accepting.”

Overall, CRWV ranks 8th on our list of AI stocks gaining Wall Street’s attention. While we acknowledge the potential of CRWV as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CRWV and that has 100x upside potential, check out our report about this cheapest AI stock.

READ NEXT: 10 AI Stocks on Analyst’s Radar Today and 10 AI Stocks on Wall Street’s Radar. 

Disclosure: None. This article is originally published at Insider Monkey.