Dan Ives Calls CoreWeave Sell-Off a False Narrative, Sees Buying Chance

what happened

According to Stocktwits, CoreWeave (CRWV) shares are having their worst week in nearly a year as investors grow worried about the AI infrastructure company's debt load and rising borrowing costs. The stock closed nearly 12% lower on Friday and is down more than 25% for the week.

Dan Ives of Yorkville Ives Partners views the selling as excessive. He says demand for AI hardware remains strong, estimating memory demand has accelerated 30% to 40% over the past 60 to 90 days. He also acknowledges that political opposition could delay or reject 5% to 10% of data center projects, but does not see that derailing the buildout.

Jefferies, meanwhile, keeps a Buy rating and a $150 price target. The firm's research note says short-duration deals at about $40 million per MW more than offset possible higher future funding costs.

why it matters

The story matters for markets as a gauge of how investors price debt-financed AI data centers. Rising CDS spreads and yields on CoreWeave's unsecured debt put the cost of capital in focus, not just demand for compute. The stock's decline compared with the QQQ and VTI ETFs shows it is falling far more than the broad market.

market impact

CoreWeave and AI infrastructure: higher debt costs weigh on the shares, while analyst views offer a counterpoint.

tags

instruments