Citizens Lifts Core Scientific to Market Outperform Amid HPC Growth and AI Deals

Core Scientific (NASDAQ: CORZ) is catching fresh eyes from analysts as its infrastructure for high-performance computing (HPC) looks set to land new customers. Citizens recently bumped its rating on the company from market perform to market outperform, setting a $30 price target that suggests the stock could climb well over 100% from current levels.

Greg Miller of Citizens pointed out that Core Scientific's robust power pipeline provides a solid base to lock in HPC leases beyond just its existing deals with CoreWeave (NASDAQ: CRWV). Given ongoing power constraints squeezing the industry, demand for HPC services is ramping up, and Core Scientific is strategically positioned to ride that wave.

Even though Core Scientific's proposed merger with cloud computing player CoreWeave fell through after shareholders voted it down in October, the company isn't left empty-handed. Miller notes that the recent contracts announced since the deal's collapse feature better terms favoring data center suppliers, hinting at potential upside if Core Scientific can replicate those kinds of agreements.

The AI sector is another runway for the company. As it deepens ties through dealmaking with artificial intelligence clients, Core Scientific could gain ground on margin improvement and contract flexibility-important in a field that moves fast and values agility.

Shares have taken a hit recently, down about 19% over the last quarter, as the market pulled back from AI stocks amid valuation jitters. However, the premarket reaction to Citizens' upgrade showed a roughly 3% bump, pointing to renewed investor interest.

Core Scientific is not alone in attracting bullish sentiment. Of the 19 analysts covering the stock, 14 carry buy or strong buy ratings according to LSEG data, reinforcing the narrative that the company could be undervalued compared to its growth potential in HPC and AI infrastructure.

The dynamics here highlight contrasting forces: a beaten-down price paired with an emerging opportunity from power assets, HPC demand, and favorable contract trends post-merger cancellation. It sets up an interesting scenario for the stock as 2026 approaches and market participants reassess the evolving data center environment.

Core Scientific currently faces stiff competition but may carve out a niche leveraging its power capabilities and nimble dealmaking. Whether this will translate into sustained share price gains remains to be seen as the broader market weighs AI stock valuations carefully.