H.C. Wainwright Cuts Core Scientific to Neutral, Citing Risks From CoreWeave Acquisition
H.C. Wainwright has downgraded bitcoin miner Core Scientific (CORZ) from a “Buy” to a “Neutral” rating, pointing to increased risks tied to the company’s planned merger with AI infrastructure firm CoreWeave (CRWV). The firm also withdrew its price target for Core Scientific, highlighting uncertainty around the combined business’s future performance.
Even so, analysts believe Core Scientific shareholders are likely to approve the all-stock deal, and there’s no immediate indication of delays in the transaction timeline.
Core Scientific’s stock traded around $15 at the time of publication, up 1.3% on the day but still down roughly 18% since the acquisition news. Shares of CoreWeave were lower by 2.6%.
The proposed merger values Core Scientific at about $20.40 per share, based on recent market prices.
H.C. Wainwright noted that its sales estimates for Core Scientific remain conservative and currently exclude the potential boost from the company’s planned high-performance computing (HPC) expansion in 2026. Still, analysts flagged several uncertainties, including the significant infrastructure investments required to make the HPC strategy a reality.
The firm cautioned that Core Scientific remains exposed to the crypto industry’s inherent volatility, such as fluctuations in network hashrate and bitcoin prices. While the company’s diversified operations help reduce some of that risk, the merger brings new exposure to challenges in CoreWeave’s AI business, like customer concentration and higher debt levels.
Other potential risks include shareholder dilution, supply chain issues for mining equipment, regulatory scrutiny, and operational hurdles.
However, H.C. Wainwright also sees possible upside if Core Scientific successfully taps into HPC revenue, which could help stabilize earnings and reduce the company’s reliance on bitcoin’s price swings.
