Cantor Fitzgerald said AI data center stocks have sold off broadly since their June highs, even though companies differ in management quality, contract strength and project execution.
- Cantor Fitzgerald flagged rising interest rates and capitalization-rate pressures as key headwinds for AI infrastructure valuations.
- It added that potential capital expenditure overruns and project execution risks are adding to investor concerns about the sector.
- Despite cutting its price targets, Cantor maintained ‘Overweight’ ratings on all seven stocks.
Shares of Bitcoin (BTC) miners that have expanded into AI and high-performance computing (HPC) infrastructure extended their declines in morning trade on Friday, with the group on track for a mostly losing week amid a broader rotation out of technology and AI-related stocks.
Cantor Fitzgerald analyst Brett Knoblauch added to the pressure by lowering price targets on seven AI data center stocks. However, he kept ‘Overweight’ ratings on all of them.
In a note to investors cited by TheFly, he said the group had sold off broadly since its June highs. He called TeraWulf (WULF), Hut 8 (HUT) and Core Scientific (CORZ) a “generational buy” that could rally 100% or more once AI funding fears ease.
HUT stock fell over 4% in morning trade, while CORZ and WULF shares dropped around 1% each. On Stocktwits, retail sentiment for both CORZ and WULF improved to ‘bullish’ from ‘neutral’ over the past day. Sentiment around HUT remained in the ‘bullish’ zone.
Why Are AI Infrastructure Stocks Falling?
According to Cantor, rising interest rates and capitalization-rate pressures, potential capital expenditure overruns, execution risks, political uncertainty and growing opposition to data centers are weighing on the sector.
It added that investors are also increasingly concerned about the capital intensity of AI infrastructure projects and the visibility of catalysts that could support further gains.
Cipher Mining Gets The Biggest Price Target Cut
Cipher Mining (CIFR) saw the steepest reduction, with Cantor cutting its target by a third, to $19 from $28, followed by CleanSpark (CLSK) and Core Scientific. CIFR stock and CLSK shares fell over 3.5% each in morning trade.
| Company | Ticker | Previous price target | New price target | Implied upside | Rating |
| Hut 8 | HUT | $180 | $151 | 106.90% | Overweight |
| Riot Platforms | RIOT | $30 | $24 | 58.90% | Overweight |
| Core Scientific | CORZ | $39 | $30 | 109.50% | Overweight |
| TeraWulf | WULF | $37 | $30 | 143.10% | Overweight |
| Cipher Mining | CIFR | $28 | $19 | 96.30% | Overweight |
| CleanSpark | CLSK | $26 | $19 | 110.90% | Overweight |
| Keel Infrastructure | KEEL | $4 | $4 | 62.60% | Overweight |
Source: Collated from investor notes on TheFly. Implied upside is calculated from each stock’s current price on Oct. 16 as of 10:20 a.m. to Cantor’s revised price target. <
On Stocktwits, retail sentiment around CIFR rose to ‘extremely bullish’ from ‘bullish’ territory over the past day, while sentiment around CLSK moved to ‘bullish’ from the ‘neutral’ zone.
The Funding Backdrop
The sector’s pullback has coincided with mounting concerns over the cost of funding AI infrastructure projects. CoreWeave (CRWV) shares dropped over 7.5% in morning trade on Friday, as yields on its bonds climbed above 15%.
The yield on the 10-year U.S. Treasury also briefly rose above 5.3% earlier this week, adding pressure to capital-intensive businesses.
Prior to Cantor’s repricing, Morgan Stanley also cut price targets on several Bitcoin miners expanding into AI infrastructure last week, citing “evolving” credit-market conditions. However, it raised its price targets on Hut 8 to $275 from $273 and TeraWulf to $65 from $62.50, leaving both well above Cantor’s revised outlook.
Read also: AI Stock Sell-Off Could Catch Bearish Investors Off Guard In ‘Right Tail Risk’, But Wall Street Feels Broader Market Signals Are Holding Up
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