Shares of CoreWeave Inc (NASDAQ:CRWV) rallied on Wednesday, after the company reported its second-quarter results.
Here are the key analyst takeaways:
- JPMorgan analyst Samik Chatterjee reiterated a Neutral rating, while lifting the price target from $110 to $120.
- Cantor Fitzgerald analyst Brett Knoblauch maintained an Overweight rating, while raising the price target from $167 to $176.
- Rosenblatt Securities analyst John McPeake reaffirmed a Buy rating and price target of $250.
Check out other analyst stock ratings.
JPMorgan: CoreWeave’s total revenue grew 112% year-on-year to $2.575 billion and pro forma operating income tracked to $128 million, surpassing consensus estimates of $2.563 billion and $66 million, respectively, Chatterjee said in a note. The company’s results inspired confidence that strong demand was not only accretive to revenue and RPO "but also to the bottom-line for AI infrastructure builders," he added.
The "single most important development" was the closing of DDTL 5.5, "which has laid out a path for the company to leverage asset-backed financing for customer contracts shorter in duration than the prior typical duration of 5 years," the analyst wrote. This expands the opportunity for CoreWeave to target customers looking for shorter contracts, which typically come with premium pricing and help diversify the customer base, he further stated.
Cantor Fitzgerald: CoreWeave delivered a "solid" beat, with adjusted operating income margin of 5.0% inflecting "materially" higher from 1.0% in the previous quarter, Knoblauch said. Yet, what stood out was "the sheer magnitude of IT capacity being energized," at around 450 MW (megawatt), which is "more than 2x larger than what its next closest competitor had in its entirety," he wrote.
This capacity growth and additional capacity coming online through the rest of the year are likely to result in a significant acceleration in revenue growth in the third and fourth quarters, the analyst stated. He expects margins to also expand through the rest of the year.
Rosenblatt Securities: While CoreWeave’s revenues surpassed expectations, the bigger beat was due to margin inflection, which led to adjusted operating income growing to $128 million from $21 million in the previous quarter, McPeake said.
Management raised its full-year revenue guidance to $12.4 billion-$13.2 billion from its prior outlook of $12 billion-$13 billion, the analyst stated. With first-half revenue of $4.653 billion, the guidance now implies $7.75 billion-$8.55 billion in the back half of the year, he added.
CRWV Stock Price Activity: CoreWeave shares were up 17.97% at $106.55 on Wednesday, according to Benzinga Pro data.
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