CORZ: AI Power Buildout And Hosting Pivot Will Shape Future Returns

Analysts have raised their price target on Core Scientific stock from $26.40 to $32.05, citing faster hyperscale contracting, an expansion of approved power capacity for AI data centers, and an ongoing shift away from Bitcoin mining toward higher-margin AI hosting deals.

Analyst Commentary

Recent research reflects a generally constructive tone around Core Scientific, with several price target increases tied to the shift toward AI data center hosting, power capacity buildout, and a move away from pure Bitcoin mining exposure. Analysts are focusing on how quickly the company can sign and execute high performance compute contracts while managing development risks and power constraints.

Bullish Takeaways

Bullish analysts highlight what they see as faster hyperscale and high performance compute contracting. They view this as supportive of higher valuation multiples if execution on new leases continues to track announced plans.
The reported addition of 1.2GW of approved power capacity this year is seen as a core asset for long term growth. Power availability is described as a binding constraint for AI data centers and a key factor for future contract volumes.
Some research notes point to the economics of the CoreWeave leases as attractive within the peer group. If this is sustained, it is viewed as supportive of margin structure and cash generation on the AI hosting side of the business.
Bullish analysts also emphasize the ongoing pivot away from Bitcoin mining toward AI hosting and high performance compute. They view a full transition of the power portfolio as a potential driver of more stable, contract based revenue.

Bearish Takeaways

Even within upbeat reports, there is an emphasis on execution risk around site development. Grid interconnection delays and electrical equipment shortages are flagged as material constraints that could slow project delivery.
NIMBY opposition and regulatory or community pushback on new or expanded sites are cited as rising concerns. These factors could affect timelines, capital needs, and the pace at which contracted megawatts translate into revenue.
Power availability is described as the binding constraint for AI data centers. While this is seen as supportive of pricing, it also limits how quickly contracted capacity can scale if new power resources do not come online as planned.
Research commentary also stresses that tenant credit quality and location durability will be key differentiators. Missteps in customer selection or site positioning are viewed as potential headwinds for long term returns, even within a higher price target framework.

What's in the News

Q1 2026 results show revenue of US$115.24 million, with colocation for AI and high performance computing becoming the largest segment, while the company reported a net loss of US$347.2 million, mainly tied to US$266.5 million of non cash impairment charges on Bitcoin mining equipment and infrastructure. Source: Q1 2026 earnings coverage
Core Scientific sold about US$208 million in Bitcoin during Q1 2026 to fund capital expenditures and liquidity, reinforcing its move away from Bitcoin self mining toward long term AI hosting contracts. Source: Q1 2026 earnings coverage
The company completed a US$3.3b senior secured notes offering to support AI data center expansion, repay debt, and fund a 4.5 gigawatt power capacity pipeline that includes new sites in Texas and Oklahoma. Source: Q1 2026 earnings coverage
Core Scientific agreed to acquire Polaris DS, which holds an energy contract for 440 megawatts of gross power, as part of a plan to scale the Muskogee, Oklahoma campus to about 1.5 gigawatts of gross capacity and roughly 1.0 gigawatt of leasable capacity. Sources: Muskogee expansion announcement, BTIG research recap
A long term, 12 year colocation agreement with CoreWeave, valued at more than US$10b, is central to the AI hosting pivot. Gross profit margins on this contract are expected in the 80% to 85% range. Source: Q1 2026 earnings coverage

Valuation Changes

Fair Value: updated from $26.40 to $32.05, indicating a higher assessed level for the stock.
Discount Rate: adjusted slightly from 9.13% to 9.15%, indicating a very small change in the required return used in the model.
Revenue Growth: revised from 62.37% to 84.35%, indicating a higher modeled growth rate for future dollar revenue.
Net Profit Margin: reduced from 32.21% to 23.22%, indicating a lower expected share of earnings retained from each dollar of revenue.
Future P/E: moved modestly from 29.16x to 28.91x, indicating a slightly lower multiple applied to projected earnings.

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Key Takeaways

Reallocating resources from Bitcoin mining to HPC infrastructure could drive future growth amid rising data center demands and diversified clientele.
Debt restructuring and 0% interest funding improve growth potential and operational efficiencies through strategic hires, enhancing financial stability and earnings.
Dependency on CoreWeave, shift in strategy, restructuring uncertainties, and execution delays pose risks to growth and profitability.

Catalysts

About Core Scientific

Provides digital asset mining services in the United States.What are the underlying business or industry changes driving this perspective?

Core Scientific secured a major HPC contract with CoreWeave, with a total revenue potential of $8.7 billion over a 12-year term, significantly boosting future revenue compared to their current levels.
The company is expanding HPC infrastructure capacity by reallocating resources from Bitcoin mining, adding new sites, and extending existing ones, expecting to drive future revenue growth as data center needs rise.
Core Scientific’s ability to diversify its customer base and reduce reliance on CoreWeave as a primary client could improve margins and provide more stable revenue streams in the long term.
The improved balance sheet following significant debt restructuring and raising $625 million through a convertible note offering at 0% interest rates positions the company to effectively fund future growth initiatives with lower interest costs, improving net margins.
Strategic hires of data center professionals enhance execution capabilities, likely leading to increased operational efficiencies, positively impacting earnings as the company grows its data center business.

Core Scientific Earnings and Revenue Growth

Core Scientific Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Core Scientific's revenue will grow by 84.4% annually over the next 3 years.
Analysts assume that profit margins will increase from -302.2% today to 23.2% in 3 years time.
Analysts expect earnings to reach $516.2 million (and earnings per share of $1.37) by about June 2029, up from -$1.1 billion today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting $1.6 billion in earnings, and the most bearish expecting $-11.0 million.
In order for the above numbers to justify the price target of the analysts, the company would need to trade at a PE ratio of 28.9x on those 2029 earnings, up from -8.6x today. This future PE is lower than the current PE for the US Software industry at 29.3x.
Analysts expect the number of shares outstanding to grow by 4.09% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 9.15%, as per the Simply Wall St company report.

Risks

What could happen that would invalidate this narrative?

The shift from Bitcoin mining to HPC hosting and the resulting decline in digital asset hosted mining revenue, which was down significantly from $30 million to $6.5 million, could adversely impact overall revenue if the new strategy doesn't ramp up as expected.
The company faced a net loss of $265 million in the fourth quarter of 2024, an increase from the previous year's loss, raising concerns about its ability to reach profitability and improve net margins in the near term.
The dependency on a singular client, CoreWeave, for a significant portion of projected revenue introduces concentration risk. If CoreWeave's demand or business model shifts unfavorably, it could dramatically decrease Core Scientific's forecasted earnings.
With the recent Chapter 11 debt restructuring, there remains uncertainty about the company’s long-term financial health and its reliance on future capital expenditures, which could put strain on cash flow and negate earnings improvements.
The delayed rollout of planned HPC capacity expansions due to permitting and equipment issues could slow revenue growth and heighten execution risk, potentially impacting future earnings.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $32.05 for Core Scientific based on their expectations of its future earnings growth, profit margins and other risk factors.
However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $55.0, and the most bearish reporting a price target of just $25.0.
In order for you to agree with the analysts, you'd need to believe that by 2029, revenues will be $2.2 billion, earnings will come to $516.2 million, and it would be trading on a PE ratio of 28.9x, assuming you use a discount rate of 9.2%.
Given the current share price of $29.05, the analyst price target of $32.05 is 9.4% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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