CoreWeave Inc. (NASDAQ: CRWV) is listed as one of the best data center stocks to buy now, but analysts from HSBC have reiterated a Reduce rating on the company with a price target of $32. They expressed concerns over margin outlook, projecting weaker utilization of data center assets and declining adjusted EBITDA margins.

HSBC analysts question CoreWeave’s long-term margin recovery potential due to high structural costs like rent and power, which make up over 20% of revenue. They also challenge assumptions around financing costs, suggesting debt expenses will remain a heavier drag than investors anticipate.

CoreWeave Inc. (NASDAQ: CRWV) specializes in AI cloud-computing and offers cloud-based GPU infrastructure to AI developers and enterprises. Despite its potential, some believe other AI stocks offer greater upside potential with less downside risk due to factors like Trump-era tariffs and the onshoring trend.

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Read more at Yahoo Finance: HSBC Maintains Reduce on CoreWeave (CRWV) Amid Margin Pressures, Debt Risks