Barclays Downgrades CoreWeave to Equal Weight Despite 156% Stock Surge

Barclays has adjusted its rating for CoreWeave (CRWV.US) from "Overweight" to "Equal Weight," citing limited short-term upside potential despite maintaining a long-term bullish outlook. Analyst Lenschow highlighted that at current levels, CoreWeave's enterprise value to 2026 earnings before interest and taxes (EV/EBIT) multiple stands at 41 times, assuming total debt of around $314 billion by 2026. While the company is expected to sustain robust growth, there is uncertainty about whether fundamental factors can drive the stock price significantly higher, given its already elevated valuation compared to industry peers.

Barclays emphasized that CoreWeave's value as one of the first pure generative AI software targets should not be underestimated. The company's business spans a vast potential market for training and inference workloads, and Barclays continues to see strong growth opportunities in the medium term. The first-quarter revenue growth of 420% year-over-year underscores this positive trajectory.

This year, CRWV's stock price has surged over 156%, significantly outperforming the S&P 500 index, which has declined by 1.34% over the same period. Following the announcement of a $40 billion collaboration agreement with Microsoft-backed OpenAI, Citigroup raised its target price from $43 to $94.

However, analysts from Seeking Alpha have taken a more cautious stance on the stock, rating it as "Hold," while analysts on Wall Street remain more optimistic, rating it as "Buy."