CoreWeave stock price surged to a record high of $175, up by over 410% from its lowest level this year. This surge has brought its market cap from $15 billion in April to over $81 billion, making it one of the biggest companies in the artificial intelligence (AI) industry.
CoreWeave’s is leveraging the AI boom
CoreWeave, a company that started its business in the Bitcoin mining industry, has become a major player in the data center industry.
The company provides data center solutions to companies building artificial intelligence solutions.
It does that by building large data centers and equipping them with the most advanced NVIDIA and AMD semiconductors. Companies like Google, Amazon, and Microsoft then lease its data centers to train their models.
CoreWeave has also expanded its business to include specialized cloud computing solutions and managed services.
Focusing on the AI boom has made it one of the fastest companies in the US today. Its annual revenue in 2022 stood at $15.8 million, and then surged to $228 million in 2023 and $1.9 billion in 2024. This means that its revenue has surged by over 12,242% in this period.
Read more: Why CoreWeave’s explosive growth doesn’t make it the best AI infra play
CoreWeave’s recent results showed that its business continued its growth as demand for data center solutions rose. Its quarterly revenue jumped by 420% in Q1 to $982 million. Its Q1 revenue was much higher than what it made in the full year of 2023.
The company ended the quarter with a backlog of $25.9 billion because of its deal with OpenAI. It is also on a path towards profitability as its adjusted EBITDA jumped to $606 million from $105 million in the same quarter in 2024.
Read more: Attention CRWV investors: it may be as far as CoreWeave stock goes in 2025
Valuation concerns remain
The biggest concern among investors is that the company is highly overvalued, considering that its market capitalization has jumped to over $73 billion.
Proponents argue that the company’s growth will help to justify its valuation. For one, the company anticipates that the second quarter revenue will be between $1.06 billion and $1.1 billion, while its annual revenue will be between $4.9 billion and $5.1 billion.
The challenge, however, is that the company is still in its early days, meaning that its capital expenditures are high as it grows its data center presence. It plans to spend between $20 billion and $23 billion this year.
The risk is that it will need to raise capital and dilute its investors to fund its capital expenditure.
The average CoreWeave stock price forecast among Wall Street analysts is $79, much lower than the current $171.93.
CoreWeave stock price analysis
The two-hour chart shows that CRWV stock price has been in a strong bullish trend in the past few months. It has moved from a low of $34.15 in April to the current $170.
The stock has moved above the important resistance level at $166.7, the upper side of the ascending triangle pattern. An ascending triangle is one of the most bullish patterns in technical analysis.
Corweave stock has moved above all moving averages, and has the momentum as the Average Directional Index (ADX) has pointed upwards.
Therefore, the stock will likely continue rising as bulls target the key resistance level at $200. This rally will continue until the company publishes its financial results on August 13. These results will provide more information about its growth.
Read more: CoreWeave stock price analysis: is it the next multibagger company?
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