CoreWeave Shares Drop 7% After Morgan Stanley's Hold Rating
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 20 2026
0mins
Source: Yahoo Finance
- Rating Downgrade Impact: CoreWeave's shares fell over 7% in morning trading on Friday following Morgan Stanley's 'Hold' rating, with analyst Keith Weiss expressing concerns about the company's ability to meet ambitious growth targets, setting a price target of $99, implying about 10% upside from current levels.
- Financing Failure Risk: The failure of Blue Owl Capital to secure financing for a planned deal has further exacerbated market uncertainties regarding CoreWeave's future, with investors questioning the company's capacity to fulfill customer commitments, particularly in light of recent legal complaints regarding service shortfalls.
- Earnings Report Expectations: CoreWeave is expected to report its fourth-quarter fiscal 2025 results on February 26, with analysts anticipating an adjusted loss per share of $0.50, an improvement from a $0.80 loss last year, while revenue is projected to reach $1.53 billion, reflecting a year-over-year increase of approximately 105%, but only about 12.5% growth from the previous quarter.
- Future Outlook Challenges: Morgan Stanley noted that future rating improvements will depend on CoreWeave scaling power capacity beyond 850 megawatts, addressing data center delays, converting projects under construction into spending, and expanding the backlog and customer base, all of which will directly impact the company's long-term growth potential.
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Analyst Views on CRWV
Wall Street analysts forecast CRWV stock price to rise
25 Analyst Rating
12 Buy
13 Hold
0 Sell
Moderate Buy
Current: 117.420
Low
68.00
Averages
123.23
High
180.00
Current: 117.420
Low
68.00
Averages
123.23
High
180.00
About CRWV
CoreWeave, Inc. is a cloud infrastructure technology company. The Company offers the CoreWeave Cloud Platform, which consists of software and cloud services that deliver the automation and efficiency needed to manage complex artificial intelligence (AI) infrastructure. Its CoreWeave Cloud Platform is an integrated solution that is purpose-built for running AI workloads such as model training and inference. Its solutions include infrastructure services, managed software services, and application software services. Its Infrastructure Services provide its customers with access to advanced graphics processing unit (GPU) and central processing unit (CPU) compute, highly performant networking, and storage. Its Managed Software Services include CKS, a flexible virtual private cloud and a bare metal service that runs kubernetes directly on high-performance servers. Its Application Software Services build on top of its infrastructure and managed software services, integrating additional tools.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Risks and Opportunities: CoreWeave's P/S ratio is close to 10, and while its financial condition is precarious, improving profitability could lead to significant growth, attracting risk-tolerant investors' interest.
See More
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- Financial Risks and Growth Potential: CoreWeave has a negative P/E ratio with $21.4 billion in debt, but its revenue reached $5.1 billion in 2025, a 168% increase, and a backlog of $66.8 billion indicates strong customer demand; if it can improve its financials, the growth potential could be substantial.
See More
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See More
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See More
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- Market Volatility Intensifies: CoreWeave's stock surged 42% in April after declines of 2% in March and 15% in February, highlighting the extreme volatility of neocloud stocks, which requires investors to navigate market risks cautiously.
- Debt Levels Raise Concerns: CoreWeave's total debt-to-EBITDA ratio stands at 8.87, with debt levels estimated between $20 billion and $30 billion, prompting industry analysts to warn that excessive debt could pressure the company financially before achieving profitability, potentially leading to acquisition.
- Uncertain Profitability Outlook: While Citi analysts project a 15% increase in Nebius's stock price over the next year, the $4.34 billion debt issued in March caused a 20% decline in its stock that month, reflecting market concerns regarding the profitability of neoclouds.
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See More
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- Rapid Technology Adoption: CEO Andy Jassy emphasized the unprecedented speed of AI adoption, citing ChatGPT's achievement of 100 million users in just four months, which is four times faster than TikTok, illustrating the widespread appeal and market potential of AI.
- Investor Sentiment Recovery: Although investor interest in AI stocks has waned recently, positive signals from the ongoing ceasefire in Iran have improved market sentiment, leading to renewed confidence in the long-term growth prospects of the AI sector, which may drive capital back into related companies.
- Long-Term Investment Opportunities: Historical data suggests that despite volatility in AI stocks, the long-term growth narrative remains intact, prompting investors to seize market dips to invest in companies excelling in AI, such as Amazon and Nvidia, with the potential for significant returns in the future.
See More
