CoreWeave, Inc. (NASDAQ:CRWV) shares are trading lower on Wednesday. HC Wainwright & Co. initiated coverage on the stock with a Neutral rating.
What To Know: Despite several positive points, HC Wainwright & Co. analyst Kevin Dede said on Wednesday that the stock may need a "minute to breathe" after soaring fivefold, compared to a 25% gain in the Nasdaq over the same period.
Some of the analyst's bullish points include CoreWeave's early deployment of Nvidia's GB200 chips, giving it a first-mover edge in AI infrastructure. The company has also secured long-term contracts with major customers like OpenAI, Microsoft and Meta, offering strong revenue visibility.
The analyst added that CoreWeave is positioned to benefit from a fast-growing AI and software market, which could boost performance and help retain customers.
On the other hand, Dede flagged several risks, including CoreWeave's heavy capital needs. Furthermore, the company has outlined a $20 to $23 billion capex plan this year, which may require taking on more debt or selling additional stock.
Additionally, the analyst pointed to execution risks tied to CoreWeave's data center partners, noting that delays or supply chain issues could make it harder for the company to meet customer obligations.
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CRWV Price Action: At the time of publication, CoreWeave stock was down 6.57% at $161.32, according to data from Benzinga Pro.
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