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Arete initiates CoreWeave and Nebius with preference for Nebius

As previously reported, Arete analyst Andrew Beale initiated coverage of CoreWeave (CRWV) with a Neutral rating and $130 price target. Coreweave and Nebius (NBIS) are neo clouds or artificial intelligence hyperscalers, building new generation GPU- rather than CPU-based cloud services, the analyst tells investors in a research note. The firm says that when including private companies, there are a couple of dozen competitors, with Coreweave having by far the most revenue. Both stocks seem likely to trade on how short of GPU compute investors think the world is, contends Arete. The firm prefers Nebius to Coreweave fundamentally, saying the stock’s embedded neo cloud valuation is low. Coreweave is an AI trading stock for now, and it is hard to take a fundamental view given the “limited free float,” adds Arete. Shares of Nebius are up 4%, or $1.46, to $40.85 in premarket trading while CoreWeave is down 5% to $155.72.

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