Core Scientific, a Major Force in AI Hosting Services

Broker Canaccord reported that Core Scientific (CORZ) is on the verge of becoming a major force in artificial intelligence (AI) hosting services.

Canaccord initiated coverage on the crypto mining company with a $16 price target. Shares were up 1.4% at $12.15 in early trading.

The broker, who highlighted that Core Scientific’s 12-year contract with hyperscaler CoreWeave in June was a game-changer, said it saw it as “the first and landmark ‘mega-deal’ signed by a bitcoin miner to provide high-performance computing (HPC) data center hosting capacity.”

A hyperscaler is a large-scale data center that specializes in providing large amounts of computing power.

Canaccord highlighted three positive drivers for the stock: “Increasing revenue and cash flow in AI hosting services and potentially more site acquisitions.”

The price target is set at around $12 for the CoreWeave contract, $3 for the chosen power source for the company’s AI hosting service, and around $1 for bitcoin mining.