Goldman Sachs Upgrades CoreWeave to Buy, Cuts Price Target to $106

CoreWeave Inc. shares rose on Monday after Goldman Sachs upgraded the stock to Buy from Neutral, while simultaneously cutting its price target to $106 from $139.

CoreWeave stock is showing upward momentum. Where is CRWV stock headed?

Goldman Sachs Upgrades CoreWeave After 43% Decline, Says Investors Overestimate Its Cost of Capital

Goldman Sachs analyst Gabriela Borges said the $106 price target implies roughly 73% upside from Friday's closing price of $61.39. CoreWeave shares have fallen 43% since reporting second-quarter results on August 11, including a 24% decline over the past five trading sessions, which Borges attributed to credit market volatility and debates over demand for frontier versus non-frontier AI models.

She believes investors are overestimating CoreWeave's future cost of capital and underestimating the potential for improved returns. "We believe the magnitude and persistence of the spread between CoreWeave's enterprise value and its unlevered internal rate of return and weighted average cost of capital are directly linked," Borges wrote. Goldman Sachs still lists financing at acceptable rates and shifts in demand structure as risks.

Goldman's analysis notes that short-duration compute contracts of three to six months are priced at approximately $40 million per megawatt, and CoreWeave raised prices by 25% in July and another 10% in October. The new price target is based on 18 times estimated EBITDA for the fifth through eighth quarters ahead, down from the 22 times implied by the previous $139 target. Last week, credit concerns intensified as yields on CoreWeave's 2032-maturing bonds approached 15%.

CoreWeave Stock Trends Higher

CRWV price action: As of the time of writing, CoreWeave shares were up 2.20% at $62.74, according to