Jefferies dey see Core Scientific for $22 inside CoreWeave gap
Jefferies don raise e price target for Core Scientific to $22 from $16 afta dem plan to buy CoreWeave. Di investment bank still keep buy rating for Core Scientific shares. Di update show say valuation gap dey inside di all-stock merger. For exchange ratio of 0.1235, Core Scientific shareholders go get shares wey/value like $12.35 based on CoreWeave current price of $100, wey dey below Jefferies fair value range of $16–$23.
Jefferies warn say if CoreWeave stock no go up before di Q4 shareholder vote, investors fit reject di deal. Di bank talk say dem fit renegotiate, talk say dem fit raise di ratio make e dey 0.16–0.20 or get collar provision to protect from market wahala. Even though Q2 revenue weak, Core Scientific do pass adjusted EBITDA estimates. Jefferies talk say di miner assets and cash flow deserve better valuation. Di research note show how investor mind dey tied to CoreWeave share wahala and talk say volatility fit happen before di merger vote.
Neutral
Jefferies report na dey mainly talk about how dem value and the way Core Scientific go join body wit CoreWeave. Dem raise the price target to $22 and still dey recommend make people buy, showing say dem get confidence for Core Scientific business. But the big difference wey dey between the valuation and the current exchange ratio plus the CoreWeave share price wey dey under $100 bring some wahala.
For short term, traders fit see CORZ price dey shake well as shareholders dey try understand if the merger fit finish for the way dem set am now. As CRVW price dey move, e go directly affect how people see CORZ value. If dem wan talk again about the deal, e fit cause more gbege.
For long term, if Jefferies suggestion for higher exchange ratio or collar provision happen, e fit make people believe say the deal fair. If the merger succeed, e go make Core Scientific stronger for the AI mining business and e go help make cash flow strong well. Overall, the news na about how companies dey deal with merger and no too concern with the whole crypto market moves. So, e no go get big impact on crypto market directly, but miners share go dey move based on how people feel about the deal.