Tech Valuation Concerns
Rothschild Issues Cautious Ratings on Five Tech and Crypto Infrastructure Stocks
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Key Points
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CoreWeave provides cloud infrastructure for accelerated computing and artificial-intelligence applications, serving AI research organizations and enterprise customers. Its GF Score was just 8 out of 100, reflecting weak readings across key financial metrics, while its trailing-twelve-month EPS was negative at $3.66 per share.
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Nebius Group emerged from the restructuring of Yandex and is building AI-focused cloud services and GPU-computing capacity for enterprises and research organizations in Europe and the United States. GuruFocus gave it a GF Score of 51 out of 100, indicating mixed financial performance, and reported a forward P/E ratio of 93.69 alongside negative cash flow.
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IREN, formerly known as Iris Energy, operates data centers powered largely by renewable energy and combines bitcoin mining with AI cloud services. GuruFocus valued the company at $23.64 versus a reported market price of $46.71, and noted that five gurus held the stock, with three increasing and two reducing their positions in recent quarters.
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Hut 8 reported a GF Score of only 18 out of 100. The company’s operations span energy infrastructure and digital-asset computing across Canada and the United States, supporting both bitcoin mining and high-performance-computing customers; GuruFocus estimated its GF Value at $33.52 against a reported price of $98.75.
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Cipher Digital, formerly Cipher Mining, operates U.S. data centers powered primarily by low-cost, carbon-free electricity. Its business includes self-mining bitcoin as well as hosting infrastructure for third-party customers, and GuruFocus placed its GF Value at $5.79 compared with a reported share price of $18.34.
Rothschild & Co issued cautious coverage on five tech stocks tied to AI infrastructure and bitcoin mining, flagging serious valuation concerns across the board. The firm rated CoreWeave and Nebius Group as Sell, with price targets of $54 and $84 respectively, while assigning Neutral ratings to IREN, Hut 8, and Cipher Digital at $40, $96, and $18 GuruFocus. Insider selling has accelerated at these companies, with $1.14 billion in stock sales at CoreWeave and $41.92 million at Nebius over three months.
CoreWeave and Nebius Group Face Steep Downside
CoreWeave, which sells cloud infrastructure for AI and accelerated computing, earned Rothschild's most negative assessment. The company's GuruFocus GF Score sits at just 8 out of 100, with trailing earnings of negative $3.66 per share GuruFocus. Rothschild's $54 price target implies 34% downside from the $81.36 current price.
Nebius Group, spun out of Yandex's restructuring, also drew a Sell rating despite a higher GF Score of 51. The company operates AI-focused cloud services and GPU capacity for European and U.S. enterprises. Its forward price-to-earnings ratio stands at an extreme 93.69, compounded by negative cash flow GuruFocus.
Renewable-Powered Bitcoin Miners Show Mixed Signals
IREN, formerly Iris Energy, pairs bitcoin mining with AI cloud services using largely renewable energy. GuruFocus valued the company at $23.64 per share against a market price of $46.71 GuruFocus. Five investment gurus hold positions, though three recently increased stakes while two trimmed holdings.
Hut 8 runs energy infrastructure and digital-asset computing across North America, supporting both bitcoin mining and high-performance-computing clients. Its GF Score is only 18 out of 100 GuruFocus. GuruFocus estimates intrinsic value at $33.52 against a current price of $98.75, suggesting 66% overvaluation GuruFocus.
Cipher Digital's Cheap Power Cannot Offset High Valuation
Cipher Digital operates U.S. data centers powered by low-cost, carbon-free electricity and runs both self-mining and third-party bitcoin hosting. The company's GF Score reflects weak fundamentals. GuruFocus places intrinsic value at just $5.79 per share against a reported price of $18.34 GuruFocus, implying 68% downside.
Valuation Disconnect Reflects Uncertain AI and Crypto Demand
All five stocks carry elevated price-to-sales and forward price-to-earnings multiples that Rothschild views as unjustified by current or near-term earnings power. Insider selling accelerating across these names—particularly the $1.14 billion departure at CoreWeave—signals insider doubts about valuations. The ratings clash with more bullish views from some analysts, highlighting deep disagreement over whether demand for AI computing infrastructure and digital-asset services can sustain current stock prices.
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