Shares in IREN Limited (IREN), the Australian AI cloud company, edged higher on Friday afternoon. This came even though JPMorgan (JPM) reaffirmed its Sell rating on the company, citing “pressure on graphics processing unit (GPU) rental pricing”. The banking giant also said to short the stock.
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Explore CWVX for 2X leverage on CRWVIREN Lands on ‘High Conviction’ Short List
On Friday, JPMorgan named IREN as one of its 25 “high-conviction” stocks to short heading into the third quarter of 2026. In other words, the investment bank is betting that IREN stock will decline in the future.
The brokerage’s other bets span multiple sectors, including consumer goods, energy, and media and telecom. As of Friday, IREN’s shares are only up about 11% despite a massive rally in 2025.
Why JPMorgan Remains Bearish on IREN Stock
JPMorgan’s four-star analyst Richard Choe made both the Sell and short calls. His GPU argument comes more than a week after news emerged that social media giant Meta (META) plans to sell its excess cloud computing capacity to third parties.
Given Meta’s hyperscaler status, the news raised fears that neocloud companies’ pricing power in the AI cloud market will be significantly weakened. It also sent shares in IREN and neocloud rivals such as CoreWeave (CRWV) and Nebius (NBIS) plunging.
“Competition continues to enter the space from companies with large-capacity offerings that could put downward pressure on GPU rental pricing,” Choe noted in the new JPMorgan report.
Interestingly, shares in these neocloud companies rebounded on Thursday. This came as analysts and market observers alike continued to pick holes in the Meta plan.
Who Is Richard Choe?
Choe is a four-star analyst who ranks in the top 15% of the more than 12,000 Wall Street analysts tracked on TipRanks. His stock coverage focuses on the real estate industry in the U.S. and Canada.
The JPMorgan analyst boasts a 66% success rate. He has generated an average return of 12.90% for investors, based on his ratings.
Is IREN Stock a Strong Buy?
On Wall Street, analysts remain cautious about IREN’s shares and have maintained their Moderate Buy consensus rating. This is based on eight Buys, two Holds, and one Sell issued over the past three months.
However, the average IREN price target of $77.20 suggests about 84% upside in the months ahead (see IREN stock forecast here).
