CoreWeave Inc. ( CRWV ) is in talks to acquire Core Scientific Inc ( CORZ )

Needham On Core Scientific

Analyst John Todaro reiterated a Buy rating and price target of $18.

There are four reasons why the proposed acquisition "make sense," Todaro said in a note. It would eliminate around $850 million in annual lease expenses and give CoreWeave ( CRWV ) ownership of the 590MW of capacity it has contracted with Core Scientific ( CORZ ), he added.

"CRWV would have ~300MW in additional capacity after an acquisition, which has the potential to be suitable for HPC/AI workloads," the analyst wrote. CoreWeave ( CRWV ) would also own sites that are "highly suitable for inference workloads," as Core Scientific's ( CORZ ) sites are mostly near major metro areas, he further stated.

Check out other analyst stock ratings.

Canaccord Genuity On Core Scientific

Analyst Joseph Vafi maintained a Buy rating and price target of $17.

Core Scientific's ( CORZ ) stock climbed on news of the potential acquisition deal with its "large strategic customer, CoreWeave ( CRWV )," Vafi said. A deal between these two companies "makes strategic sense in many ways," he wrote.

Most of Core Scientific's ( CORZ ) data center portfolio is being repurposed from Bitcoin mining to AI data center. CoreWeave ( CRWV ) has already procured much of this capacity under long-term contracts, the analyst stated. By acquiring Core Scientific ( CORZ ), CoreWeave ( CRWV ) would no longer need to pay service costs, he added.

CORZ, CRWV Price Action: Shares of Core Scientific ( CORZ ) were up 0.76% to $16.52 at the time of publication on Friday; CoreWeave ( CRWV ) shares are up 5.73% at $167.23.

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