Investors 'probably' expected a higher valuation for Core Scientific, Bernstein says after bitcoin mining stock falls 17%

Core Scientific, the bitcoin miner pivoting to AI infrastructure, fell 17% on Monday following confirmation that CoreWeave will acquire the company in an all-stock deal worth about $9 billion .

News of the potential deal was first reported on June 26 , which led to a 30% spike in Core Scientific's stock (ticker CORZ). Shares had appreciated another 20% since before today's selloff. Bernstein analysts, led by Gautam Chhugani, said the market may have been hoping for a higher price tag and balked at an all-stock deal, especially given that CoreWeave's shares have tripled this year.

"The market was probably expecting a higher valuation, and investors were disappointed with an all stock deal," the analysts wrote in a flash note to clients. "In absence of any price protection specified in the deal structure and the Q4 closure, it is probably a fair reaction, since investors could be concerned on deal closure, if CoreWeave stock fluctuates materially until closure."

The deal reshapes the economics of AI infrastructure development and may prompt investors to reevaluate bitcoin miners with scalable, AI-ready power capacity, according to Bernstein.

Bernstein notes that CoreWeave’s prior 12-year, $10 billion co-location agreement with Core Scientific likely contributed to the premium valuation. By acquiring CORZ, CoreWeave eliminates this long-term lease obligation and gains full control of the company’s data center and power infrastructure, enhancing capital efficiency and buildout flexibility.

"We believe, there could be an ongoing re-rating for AI focused miners, with (i) large power capacity; (ii) AI/HPC site development under progress or successful demonstration of proof of concept, and (iii) strong balance sheet without legacy/restrictive debts," the analysts wrote, noting that IREN and Riot Platforms have announced allocating some part of their power capacity for AI/HPC.

Of note, IREN recently became the latest bitcoin miner to reach the 50 EH/s milestone, following MARA and CleanSpark, The Block previously reported .

Less than a year after going public in January 2022 via SPAC merger, Core Scientific filed for Chapter 11 bankruptcy protection in December 2022. Shares were relisted on the Nasdaq in 2024 after reorganization. CoreWeave previously attempted to buy the bitcoin miner in June 2024 for approximately $1 billion.