"Shares of CoreWeave ( NASDAQ:CRWV) were brutally punished as shares eventually went on to shed more than 64% of their value from peak to trough. While the AI-driven cloud provider is still up comfortably from its IPO price, there has been growing concern about an AI bubble, especially in the smaller, higher-multiple names that have more growth promise. With AI demand staying as hot as ever, perhaps investors who are comfortable with taking on more risk for greater growth might wish to give CoreWeave another look now that there's some newfound momentum behind it to start the year. The stock has been on a decent rally in recent weeks, rising close to 50% from its December lows."
"Undoubtedly, the sell-off was vicious and perhaps a bit overdone. But, what's more, the firm stands out as a sizeable winner as the new generation of Nvidia ( NASDAQ:NVDA) chips launches in the second half of 2026. Of course, the debt concerns, customer concentration, and fears of an AI bubble remain. Not much has changed about that. Still, with the valuation in a more modest spot today than at the end of last year, those who are confident in the firm's strategy might wish to pick up a few shares should the AI trade find its footing again. Now, CoreWeave is still spending heavily in the new year, and that's not going to sit right with many investors who are looking for lower-risk ways to trade AI."
CoreWeave's shares plunged over 64% from peak to trough but remain above the IPO price. Recent momentum drove a roughly 50% rally from December lows. Persistent concerns include heavy spending, debt levels, and customer-concentration risk, while valuation sits lower than late last year. Strong AI demand and the launch of next-generation Nvidia chips in the second half of 2026 present potential upside for capacity providers. AI infrastructure stocks appear broadly oversold, attracting contrarian interest from investors willing to accept higher risk for growth. The outlook hinges on revenue acceleration, capital deployment, and whether investor risk appetite for AI returns.
Read at 24/7 Wall St.
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