Contrary to the market’s reaction to CoreWeave Inc’s (NASDAQ:CRWV) third-quarter earnings, the results indicated “encouraging prospects,” according to HC Wainwright analyst Kevin Dede.
The CoreWeave Analyst: Dede maintains a Buy rating and a $180 price target.
The CoreWeave Thesis: The company’s revenues grew sequentially by 13% to $1.36 billion, while its RPO and revenue backlog came in at $50 billion and $55.6 billion, Dede said in the note.
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Backlog was up 85% sequentially, driven by “large-scale, multiyear compute contracts signed with marquee customers,” including Meta Platforms Inc (NASDAQ:META) and OpenAI, he added.
CoreWeave’s shares tanked 17% after the company reduced fourth-quarter guidance due to a delay in delivering to contract, the analyst stated.
The delay is “only a minor issue not materially affecting next year’s outlook given consistently high demand for compute resources and greater end market acknowledgment of CoreWeave’s AI development prowess,” he further wrote.
The market’s response to the release was an “over-reaction,” Dede commented.
CRWV Price Action: Shares of CoreWeave had declined by 0.51% to $87.94 at the time of publication on Wednesday.
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