Whenever AI top dog Nvidia (NASDAQ:NVDA) places a bet, it’s hard not to be tempted to follow suit, especially given Jensen Huang seems to know where the puck is headed next in the fast-moving world of AI. Indeed, if he sees value in the AI scene, perhaps it’s wise to give him the benefit of the doubt, even if there’s a lack of profitability.
At the end of the day, growth investing, especially hyper-growth investing in the wild world of AI, is not easy. But if it’s good enough for Jensen and company, it must be worth adding to the radar, right?
In any case, we’ll look further into a recent investment that saw Nvidia pick up a $900 million stake (as of March 2025) in CoreWeave (
Key Points
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CoreWeave stock is coming back to earth. Growth investors who missed the post-IPO rally may have a shot to get in.
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The explosive AI hyperscaler has a lot of big names backing it. But investors should be mindful of the risks, especially as momentum reverses course and the tech trade gets more turbulent.
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CoreWeave is growing fast, but shares are now in the process of going bust after that initial post-IPO boom
Undoubtedly, the AI infrastructure provider has a lot going for it, and while its multiple may seem absurdly expensive at around 19 times price-to-sales (P/S), with no price-to-earnings (P/E) multiple to go by, having quick access to Nvidia’s newest and finest chips, I think, is a positive than many may overlook with the name.
Also, CoreWeave is moving incredibly fast to grow its share of the market. Whether we’re talking about M& or aggressive cap ex, the company isn’t wasting time as it looks to pick up the pace further now that it’s a public company. As a relatively small ($50 billion) AI hyperscaler that’s “flooring it,” it’s not a mystery why many Wall Street analysts covering the name are staying bullish, even after the explosive action we’ve witnessed since IPO day earlier this year.
More recently, a Citi analyst got off the sidelines, slapping a buy rating (up from hold) on CRWV, citing accelerating growth going into 2026. Also, Microsoft (NASDAQ:MSFT) just came off a blowout quarter, which likely contributed to the big CRWV upgrade, given that the enterprise behemoth is, by far, CoreWeave’s largest customer.
A rapid AI growth play with all the right tailwinds at its back
In any case, CoreWeave stands out as a rapid AI grower that many skeptical analysts may have to chase and change their tune over time. Undoubtedly, it’ll be exciting to see what kind of growth the firm can pull off in the new year. And while the firm’s growing slice of the high-performance AI compute scene seems destined to go higher, there are going to be some serious bumps in the road. Even a few strong quarters in 2026 may or may not be able to move the needle higher on the stock if expectations are through the roof.
For now, those keen on getting in on the highly-regarded AI stock should buy into a full position on weakness. Indeed, shares have nearly been dealt a 50% haircut. Perhaps the winner of the IPO class of 2025 could soon be a bargain.
Of course, it’s tough to tell how much CRWV ought to be worth, given all the moving parts. But if the sell-off extends and there’s an opportunity to snag shares at closer to their IPO price, I’d be inclined to take a bet despite the elevated volatility and uncertain valuation.
The bottom line
CoreWeave is doing everything right and stands to benefit greatly if the AI boom strengthens going into the new year. With some big titans, like Nvidia, backing the firm, it’s hard to look away from the firm, even as shares undergo their first real sell-off as a public firm.
Though I wouldn’t blindly buy the dip, I would think about initiating a small position now and on further pressure that may arise as the season of volatility approaches. Despite Citi’s newfound optimism for the firm, it’s still keeping the “high risk” label on the name and for good reason. Shares could go either way over the near term.
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