HSBC Initiates Coverage on CoreWeave with Bearish Outlook, Slashing Price Target to $32.

CoreWeave stock has dropped 6.3% to $134.08 after HSBC analyst Abhishek Shukla issued a $32 price target and a "Reduce" rating (equivalent to Sell). Shukla cited elevated cost forecasts and few options for diversification as reasons for the rating. The analyst's bearish outlook is the most negative yet for the AI cloud vendor.

CoreWeave Inc. (CRWV) stock has seen a significant drop, falling 6.3% to $134.08, following a downgrade from HSBC analyst Abhishek Shukla. Shukla initiated coverage of CoreWeave with a "Reduce" rating (equivalent to Sell) and a $32 price target. This marks the most bearish outlook yet for the AI cloud vendor [1].

Shukla cited several reasons for the downgrade, including elevated cost forecasts and few options for diversification. He noted that CoreWeave's revenue is heavily reliant on a few key customers, such as Microsoft, Open AI, and Nvidia, which do not use the company's software services. This dependency diminishes CoreWeave's competitive advantage and customer lock-in [1].

Moreover, Shukla highlighted that CoreWeave's stock is overvalued, having skyrocketed more than 240% since its public offering in late March. The analyst also pointed to higher borrowing costs, low asset turnover, and expected high capital expenditure costs due to the short shelf life of graphic processing units (GPUs) as additional headwinds [1].

The downgrade comes as most analysts are not sold on CoreWeave despite its massive gains since going public. According to LSEG data, 17 of 23 analysts covering the stock rate it as a hold, while only four have buy or strong buy ratings, and two have underperform ratings [1].

References:
[1] https://www.cnbc.com/2025/07/17/hsbc-says-coreweave-shares-will-drop-more-than-70percent-on-concerns-about-customer-base.html