UBS Group AG turns contrarian and turns bullish on CoreWeave (CRWV.US): initiates coverage with a "Buy" rating, betting on a return of rotation into AI trades.

UBS Group AG initiated coverage on emerging cloud provider CoreWeave (CRWV.US) with a "Buy" rating and a $120 price target. UBS Group AG analyst Karl Keirstead wrote in a note to clients: "Although AI compute demand signals are very strong and there is ample evidence that CoreWeave's revenue per GW metric will continue to climb, Wall Street sentiment remains very cautious (reflected in its valuation of just 3x 2027 estimated revenue)." He said: "We understand these concerns (mainly leverage and credit risk), but believe they are peaking, so we are making a contrarian bullish call and assigning a 'Buy' rating." Keirstead further analyzed that investors may continue to take a "defensive" approach to AI-related stocks, but CoreWeave has built a solid reputation for reliability and outstanding performance, which should make it stand out among peers. Keirstead added: "The bullish rating on CoreWeave stock is essentially a bet that investors will soon rotate back into long AI trades. Given current depressed sentiment, strong demand signals, and reports that frontier labs are growing, this scenario seems increasingly likely." In contrast, Bernstein gave CoreWeave an "Underperform" rating with a $74 price target. Bernstein positions CoreWeave as a "transitional capacity provider": benefiting from power and GPU scarcity, but with customer concentration, a tendency among buyers to build their own capacity, and a constrained return structure. Once data center capacity eases, it will be the first and hardest hit. Data shows CoreWeave 2Q26 revenue of $2.58 billion (YoY +112%), backlog of approximately $104 billion (YoY +246%), and across-the-board price increases of about 25% in July.