DA Davidson Upgrades CoreWeave to Neutral, Sees OpenAI Fundraise as Near-Term Catalyst

Core View - DA Davidson upgraded CoreWeave from Underperform to Neutral and raised its price target to $68.00 from $36.00 after shares rose more than 2% intraday on Monday [1] - The firm believes that the equity value in CoreWeave could ultimately be wiped out, as the enterprise's value is largely accruing to debt holders [1] OpenAI Fundraising Impact - A successful $100 billion fundraising by OpenAI could enable it to meet its 2026 commitments, including those involving CoreWeave, potentially delaying near-term pressure on the company [2] - However, this does not change the long-term value destruction inherent in CoreWeave's business model [2] Risks of Fundraising Shortfall - If OpenAI's fundraising effort falls materially short of the $100 billion target by the end of March, CoreWeave's equity value could deteriorate rapidly [3] - DA Davidson continues to advise investors to avoid the stock over the long term [3] Valuation Methodology - The new $68 price target is based on 1x remaining performance obligations, consistent with current market approaches for valuing neocloud companies [4] - While the methodology is described as imperfect due to return and backlog risks, it allows justification for the higher target under internal ratings criteria [4]