CoreWeave (NASDAQ:CRWV), a leading AI datacenter platform, has earned a ‘Buy’ rating and $42 price objective from Bank of America analysts in their initial coverage of the company.
Analysts believe CoreWeave is well-positioned to take share in the rapidly expanding AI Infrastructure-as-a-Service (IaaS) market, which is projected to reach $79 billion by 2028, growing at a 62% three-year compound annual growth rate (CAGR).
The firm’s purpose-built cloud platform, optimized for GPU compute, supports major AI players including Microsoft, OpenAI, and Nvidia.
Customer feedback cited in the report positions CoreWeave as a best-in-class operator, highlighting faster GPU deployment cycles, lower failure rates, and significantly higher utilization.
The analysts attribute these performance gains to the company’s proprietary software stack, efficient data center designs including liquid cooling, and substantial access to power resources.
Bank of America emphasized that CoreWeave’s proprietary software, which automates functions such as provisioning and load balancing, not only enhances infrastructure performance but also holds potential to evolve into standalone software revenue streams.
“We believe these advantages are sustainable in the near term, at a time when demand for GPUs is accelerating,” they wrote.
They see a healthy risk/reward profile for CoreWeave in the near-term, with long-term growth potential.
The stock trades at 11.8x estimated calendar year 2027 earnings before interest and taxes (EBIT), below the 12.7x average for the broader datacenter peer group.
In a bullish scenario, analysts forecast a five-year revenue CAGR of 52% and EBIT CAGR of 72%, driven by ramping AI demand and normalization of OpenAI-related capex by late 2025.
Shares of CoreWave traded up 8.2% at $38 following the release of Bank of America’s report.