CoreWeave is highly reliant on Microsoft for revenue. Plus, soon insiders will be able to sell shares after the post-IPO lockup period expires.

Following a quadrupling for CoreWeave Inc.'s stock since the data-center operator's initial public offering, one analyst is moving to the sidelines.

Mizuho's Gregg Moskowitz cut his rating on CoreWeave shares (CRWV) to neutral from outperform on Tuesday, writing that their "extremely high volatility presents notable risks" both to positive and negative outlooks. But on the whole, he sees the shares as appropriately valued, while acknowledging "the outsized returns" since CoreWeave's IPO in late March.

There are other risks as well for CoreWeave, according to Moskowitz. One is that the company's revenue is heavily concentrated. The company generated about 72% of its sales from Microsoft in the March quarter.

As Mizuho desk-based analyst Jordan Klein wrote in a separate piece of commentary from the sales team, it's difficult "for anyone to justify this valuation even with strong growth and new major contracts from OpenAI and others."

Moskowitz boosted his target price to $150 from $70 despite the downgrade, a move that reflects just how much CoreWeave shares have surged in a short period of time.

The downgrade comes a day after CoreWeave announced plans to purchase Core Scientific Inc. (CORZ), an infrastructure-services provider, in an all-stock deal valued at roughly $9 billion. Moskowitz has an upbeat view of that transaction, but it's not enough to keep him bullish on the stock overall in light of the risks elsewhere.

"We believe this reflects good value given [CoreWeave's] ability to verticalize the infrastructure supply chain while driving significant cost synergies and enabling more financing flexibility," Moskowitz wrote.

He added that the deal was "leverage-neutral," since CoreWeave will be paying for Core Scientific in stock.

Meanwhile, CFRA analyst Angelo Zino initiated coverage of CoreWeave's stock with a hold rating late on Monday. He too praised the financial flexibility that would come with the Core Scientific deal, although he has concerns about the stock as well, namely around the end of the lockup period, at which point insiders who were initially restricted from selling stock after the IPO will be able to unload shares.

CoreWeave noted in its IPO prospectus that the lockup period extends until either the close of trading on the second day after the company reports its second quarter of earnings as a public company or 180 days after the March 20 date of the prospectus, whichever is earlier.

The stock fell 5.2% on Tuesday.