Wall Street is getting serious about the so-called neocloud sector. And it is no mystery why: the artificial-intelligence-as-a-service market could balloon in size in the next eight years.

Northland Equity Capital Markets analyst Nehal Chokshi on Friday initiated coverage of four neoclouds, companies that sell AI computing power. Chokshi placed bullish Outperform ratings on Iren, Boost Run, ChronoScale, and SharonAI.

The analyst placed a price target of $99 on Iren which represented 128% upside from the closing price of $43.48 on Thursday. Chokshi has price targets of $36 on Boost Run, $32 on ChronoScale, and $95 on SharonAI.

Iren stock rose 2.8% to $44.71 on Friday. Boost Run and SharonAI advanced 3.2% and 2.5%, respectively. ChronoScale, meanwhile, declined 2%.

Key to the bullish initiations was the firm's estimate that the AI-as-a-service, or AIaaS, market, which allows businesses and developers to use AI over the internet as opposed to building complex systems from scratch, will hit about $4 trillion by 2034.

That's well above the estimated $853 billion market by the end of 2027, based on data-center demand for chips from Nvidia, Broadcom, and Advanced Micro Devices.

The massive market growth would be a boon for providers of AI compute-or the raw processing capacity that hardware chips use to build, train and use AI models. The space was pioneered by CoreWeave.

Along with an expanding AI as a service market, hourly rental fees for computing power have already increased about 33% since December 2025, according to Northland. Hyperscalers, however, are still charging about three times more than neocloud providers, which leaves room for more price appreciation. Some of the largest hyperscalers include Amazon Web Services and Microsoft.

"We expect the price rise momentum for the neocloud spot market to continue, and for contract pricing to follow as long as supply remains well below demand," Chokshi wrote.

The analyst added that neocloud providers which already have, or are working on, their own software ecosystems are particularly well placed in the current pricing environment.

With a software component, neoclouds can close the gap to hyperscalers by moving beyond simply offering raw computing power and adding management and optimization layers that could mean customers remain on their systems for longer.

These stocks include CoreWeave, Nebius, Iren, and ChronoScale.

Iren, in particular, has a "clear path to software differentiated AIaaS" with its acquisition of cloud infrastructure and software company Mirantis, according to Chokshi.

The bullish initiation by Northland on Iren was just the latest from Wall Street.

J.P. Morgan analyst Richard Choe on Monday double upgraded Iren to Overweight from Underweight and raised his price target to $65 from $46.

Choe wrote that Iren has turned itself into "top tier" neocloud provider and that the company, which has shifted its focus AI computing power from Bitcoin mining, has seen momentum with customers and that its strategic partnership with Nvidia has added legitimacy to its AI cloud services business.

Of the 19 firms polled by FactSet, Iren stock has an average Buy rating with a price target of $82.54.