Observed Signal · May 5, 2026 · Analyst Upgrade · Source: CNBC Investing · Impact: 2/5 · Sentiment: Neutral
JPMorgan Upgrades Cogent Amid AI Data‑Center Sales
JPMorgan upgraded Cogent Communications to Overweight from Neutral after the stock plunged following weak first-quarter results. Analyst Sebastiano Petti set a reduced price target of $22 (from $23), still implying roughly 34% upside from the prior close, citing a favorable mix shift toward On‑Net and Waves revenue (+9% year‑over‑year in Q1 2026 combined) and progress on the planned sale of data centers. Cogent reported adjusted EBITDA of $70.2 million versus $73.9 million expected and revenue of $135.6 million versus a $136.6 million consensus, triggering a ~29% one‑day decline. CEO Dave Schaeffer said proceeds from the expected sale of 10 data centers should exceed prior terminated deals (notably a $144 million two‑center agreement) and will be used to reduce debt and help refinance 2027 unsecured notes.
Analyst upgrade tied to Cogent's AI data‑center asset sales and balance‑sheet repair provides useful signals about infrastructure consolidation and financing, but has limited direct impact on the broader AdTech/MarTech industry.
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Key Takeaways & Evidence Grounding
- JPMorgan upgraded Cogent Communications to Overweight from Neutral and lowered its price target to $22 from $23.
- JPMorgan cited a combined +9% year‑over‑year shift in On‑Net and Waves revenue in Q1 2026 as a positive driver.
- Cogent reported adjusted EBITDA of $70.2 million (versus $73.9 million expected) and revenue of $135.6 million (versus $136.6 million consensus).
- Shares fell about 29% in one day after the earnings miss.
- Cogent expects to sell 10 data centers (expected early this summer) with proceeds that CEO Dave Schaeffer said should exceed a prior $144 million terminated agreement; proceeds will be used to reduce debt and refinance 2027 unsecured notes.
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JPMorgan Upgrades CoreWeave on Short-Term Contracts
JPMorgan upgraded CoreWeave to Overweight from Neutral, raising its price target to $125 from $120, implying nearly 44% upside. The upgrade is driven by favorable pricing for compute due to strong demand and CoreWeave's willingness to pursue short-term contracts at premium pricing, which is expected to boost revenue and margins. CoreWeave's stock had fallen 13% in Q3 amid concerns about capital expenditures for AI infrastructure, but JPMorgan sees these investments translating into financial gains. The analyst, Samik Chatterjee, notes that shorter-term contracts reflect lender confidence in sustained GPU demand. The majority of Wall Street analysts rate CoreWeave a buy or strong buy.
JPMorgan Downgrades Meta Over Massive AI Capex
JPMorgan downgraded Meta Platforms from overweight to neutral and cut its price target to $725 from $825, citing concerns about the company's large AI capital expenditures and intensifying full-stack AI competition. Meta raised its full-year capital expenditure guidance to $125 billion–$145 billion from $115 billion–$135 billion, after reporting better-than-expected Q1 results. JPMorgan analyst Doug Anmuth said Meta faces a challenging path to returns on heavy AI capex beyond advertising as rivals such as Google and Amazon benefit from deeper enterprise integrations, silicon supply and model diversity. The note also referenced Meta’s AI initiatives — including Meta Superintelligence Labs, the acquisition of Scale AI and the rollout of Muse Spark — while LSEG data shows most Wall Street analysts still rate the stock a buy.
JPMorgan Upgrades Ameren on Data Center Deals
JPMorgan upgraded utility Ameren to overweight from neutral and raised its price target to $126 from $120, citing growing confidence in the company’s growth outlook as it secures electricity agreements for data centers. Analyst Jeremy Tonet highlighted deals in Illinois and Missouri, noting Missouri’s favorable regulatory environment for large-load data center customers. LSEG data shows analyst coverage is split — nine buy/strong buy and nine hold — and Ameren shares are up about 9% year-to-date. JPMorgan said the new data-center datapoints increase confidence that Ameren’s EPS CAGR could inflect higher.
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