CoreWeave shares rose more than 6 percent in premarket trading after Goldman Sachs upgraded its rating. The stock has fallen sharply in recent sessions, and Goldman Sachs pointed to demand for artificial intelligence computing and the potential for profitability to improve.

Decrypto, a blockchain media outlet, reported on Oct. 19 local time that CoreWeave shares were up 6.53 percent at $65.40 in premarket trading from the previous session's close.

Goldman Sachs upgraded its investment rating on CoreWeave to buy from neutral. It cut its price target to $106 from $139. Despite the lower target, the new price target is about 62 percent above the premarket price.

The rebound followed a recent string of sharp declines. CoreWeave closed at $61.39 in the previous session on Oct. 17, down 11.91 percent on the day. Goldman Sachs estimated the stock has fallen 24 percent over the past 5 trading sessions and 43 percent since its second-quarter earnings release on Aug. 11. Compared with its Oct. 9 closing price of $82.08, the shares remain about 20 percent lower even after the premarket rebound.

Concerns about financing costs have weighed on the shares. CoreWeave has continued large-scale investment to expand the high-performance computing infrastructure needed for AI workloads. But a recent surge in unsecured bond yields has prompted views that its future funding burden could rise. A key investor focus is whether demand for high-performance AI models will translate into actual revenue to support heavy infrastructure investment costs.

Gabriela Borges (가브리엘라 보르헤스), an analyst at Goldman Sachs, said the market is excessively pricing in the risk of higher future borrowing costs for CoreWeave while undervaluing the earnings the company's computing assets can generate.

Borges expects annual recurring revenue per megawatt to rise over the next 24 months. She said limited available computing capacity, along with CoreWeave's computing performance, cost competitiveness and ability to bring new facilities online, could support revenue growth. She also said higher revenue per megawatt could improve internal rates of return excluding debt burdens.

She also expects any rise in borrowing costs to remain limited. Borges said CoreWeave's blended borrowing cost is likely to rise by 100 to 200 basis points, or 1 to 2 percentage points. Based on discussions with credit investors in the sector, she saw limited scope for a larger additional rise.

CoreWeave's unsecured debt recently traded at an implied yield of 13.5 to 15 percent, based on minimum expected returns. That suggests bond investors are demanding high yields to reflect CoreWeave's credit risk. Goldman Sachs said such unsecured bond yields could overstate the company's actual cost for new funding because CoreWeave mainly uses loans secured by assets such as computing infrastructure.

CoreWeave used that financing structure in August to sign a $2.6 billion infrastructure asset-backed loan commitment. The terms at the time were the Secured Overnight Financing Rate plus 5.5 percentage points. The funds are planned to be used for purchasing computing equipment and deploying it to customers, but that rate does not apply as-is to all future borrowing terms.

Other Wall Street analysts are also focusing on CoreWeave's growth outlook. Cantor Fitzgerald analyst Brett Knoblauch maintained an overweight rating and a $176 price target on CoreWeave on Oct. 17. He assessed that nearly all computing capacity scheduled to be supplied in 2027 is already contracted.

A contract with Nvidia is also drawing attention in relation to CoreWeave's computing demand. Under a contract disclosed in September 2025, Nvidia must buy unsold computing capacity that meets certain requirements by April 13, 2032. The contract includes conditions related to termination, delivery and service availability.

CoreWeave's tokenised stock, CRWVB, also rose 7.2 percent over 24 hours to trade at $65.23. But tokenised assets are separate from CoreWeave shares listed on Nasdaq, making it difficult to directly compare that return with the premarket share gain.

Goldman Sachs said uncertainty remains over the next 12 months, including AI infrastructure demand, actual available computing supply and residual equipment values. CoreWeave's share performance is expected to hinge on whether AI computing demand translates into sustained revenue and profitability, and whether it can maintain financing conditions that support large-scale facility investment.