CoreWeave stock holds steady as Stifel reiterates $120 price target

CoreWeave reported mixed Q3 results, with revenue exceeding estimates due to strong GPU demand, but lowered its full-year guidance as a 50MW data center delivery delay shifts revenue recognition to FY2026. Despite this near-term supply-side issue, the company's backlog nearly doubled to $55.6 billion with major contracts from OpenAI and Meta, and analysts project 174% revenue growth for FY2025, though unprofitability is expected. Stifel reiterated a "Hold" rating, acknowledging strong underlying momentum but awaiting resolution of supply-side challenges, while other firms adjusted price targets reflecting both significant growth potential and deployment delays, with the stock trading above fair value despite a 164% annual return.

Analysis

CoreWeave reported strong Q3 2025 revenue of $1.4 billion and an adjusted operating margin of 15.9%, surpassing consensus estimates due to robust GPU demand. However, the company lowered its full-year guidance, attributing this to a 50-megawatt data center delivery delay that shifts revenue recognition into fiscal year 2026. Stifel characterized this as a "near-term supply-side issue," masking underlying business momentum.

Despite the guidance cut, CoreWeave's long-term growth prospects appear robust, with its backlog nearly doubling to $55.6 billion, supported by significant contracts with OpenAI and Meta. The total contracted power pipeline expanded to 2.9 gigawatts, with 1.0 gigawatt unmarketed, indicating substantial future capacity. Analysts still project 174% revenue growth for FY2025, although unprofitability is expected with a forecasted EPS of -$1.24.

Stifel reiterated a "Hold" rating with a $120 price target, acknowledging strong momentum but awaiting resolution of supply-side challenges. Other firms like Macquarie, BofA, and Mizuho adjusted price targets downwards due to delivery and supply issues, while Morgan Stanley raised its target. The stock trades above its Fair Value despite a 164% price return over the past year, and a current ratio of 0.52 indicates short-term liquidity concerns.

Key Decisions for Investors

• Investors should closely monitor CoreWeave's progress in resolving data center delivery delays and supply-side constraints, as these directly impact near-term revenue recognition and guidance.
• Given the stock trades above its Fair Value and has a low current ratio of 0.52, investors should carefully assess the balance between CoreWeave's significant growth potential from its backlog and its current valuation and liquidity profile.
• Consider the implications of projected unprofitability for FY2025 (EPS -$1.24) despite strong revenue growth, focusing on the company's path to sustainable profitability and cash flow generation.