CoreWeave (NASDAQ:CRWV) Stock Price Down 10.1% – What’s Next?

CoreWeave Inc. (NASDAQ:CRWV)’s share price traded down 10.1% during trading on Thursday. The company traded as low as $53.50 and last traded at $55.60. 80,328,445 shares traded hands during trading, an increase of 161% from the average session volume of 30,794,932 shares. The stock had previously closed at $61.82.

CoreWeave News Summary

Here are the key news stories impacting CoreWeave this week:

• Positive Sentiment: Bank of America maintained a Buy rating and a $140 price target, forecasting third-quarter revenue growth of 168% as new data-center capacity comes online. The view supports the bull case that strong AI-compute demand can drive substantial growth. CoreWeave capacity expansion to drive revenue growth, Bank of America says
• Positive Sentiment: Positive industry commentary provided some support: Nvidia CEO Jensen Huang and SpaceX executives have argued that demand for AI computing remains strong and that fears of a capacity glut may be exaggerated. Blackstone’s Jon Gray also said CoreWeave should be able to work through its financing pressure. Blackstone’s Jon Gray says CoreWeave can find a way through financing pressure
• Neutral Sentiment: Analysts remain sharply divided. Some see CoreWeave’s multiyear customer contracts, rapidly rising revenue and AI infrastructure demand as compelling, while others argue that heavy capital requirements and uncertain cash flows make the current valuation difficult to justify. CoreWeave stock may be near fair value following debt concerns
• Negative Sentiment: Bernstein’s downgrade and price-target cut intensified concerns about CoreWeave’s funding needs. Bernstein reportedly estimates a potential funding gap of $76 billion, substantially above Goldman Sachs’ estimate, raising questions about future borrowing, dilution and shareholder returns. Bernstein puts CoreWeave’s funding gap at $76 billion
• Negative Sentiment: CoreWeave’s bonds and credit-default swaps have signaled rising default risk. Bonds have traded at distressed yields, including a reported 9.625% yield on debt due in 2032 and nearly 16% on some other issues. Investors fear that higher financing costs could limit expansion or leave less value for shareholders. CoreWeave’s market confidence erodes as bond yields spike

Wall Street Analyst Weigh In

Several equities research analysts have issued reports on CRWV shares. William Blair began coverage on shares of CoreWeave in a research note on Wednesday, September 30th. They set an “outperform” rating on the stock. Deutsche Bank Aktiengesellschaft restated a “buy” rating and set a $150.00 target price on shares of CoreWeave in a report on Friday, August 7th. Truist Financial increased their price target on CoreWeave from $155.00 to $165.00 and gave the company a “buy” rating in a report on Monday, August 24th. HSBC reiterated a “reduce” rating and set a $39.00 price objective on shares of CoreWeave in a research report on Tuesday. Finally, Northland Securities set a $200.00 price objective on CoreWeave in a research note on Wednesday, October 7th. Twenty-five research analysts have rated the stock with a Buy rating, eight have issued a Hold rating and three have assigned a Sell rating to the stock. According to MarketBeat.com, CoreWeave presently has an average rating of “Moderate Buy” and an average price target of $131.57.

CoreWeave Stock Performance

The company has a market capitalization of $25.51 billion, a price-to-earnings ratio of -15.23 and a beta of 7.36. The stock’s fifty day simple moving average is $84.98 and its 200-day simple moving average is $94.22. The company has a current ratio of 0.46, a quick ratio of 0.46 and a debt-to-equity ratio of 5.53.

CoreWeave (NASDAQ:CRWV) last announced its quarterly earnings data on Tuesday, August 11th. The company reported ($1.14) earnings per share (EPS) for the quarter, beating the consensus estimate of ($1.52) by $0.38. CoreWeave had a negative return on equity of 47.95% and a negative net margin of 25.41%. The business had revenue of $2.58 billion during the quarter. During the same quarter in the previous year, the business posted ($0.27) EPS. The business’s quarterly revenue was up 112.5% compared to the same quarter last year. Analysts predict that CoreWeave Inc. will post -4.95 EPS for the current year.

Insider Activity at CoreWeave

In other CoreWeave news, CEO Michael Intrator sold 200,000 shares of CoreWeave stock in a transaction that occurred on Tuesday, July 28th. The stock was sold at an average price of $66.62, for a total transaction of $13,324,000.00. Following the transaction, the chief executive officer owned 2,276,815 shares of the company’s stock, valued at $151,681,415.30. The trade was a 8.07% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, major shareholder Magnetar Financial Llc sold 307,131 shares of CoreWeave stock in a transaction on Friday, August 14th. The shares were sold at an average price of $108.75, for a total transaction of $33,400,496.25. Following the completion of the transaction, the insider directly owned 220,810 shares in the company, valued at $24,013,087.50. The trade was a 58.18% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold 5,352,578 shares of company stock worth $471,777,344 over the last quarter. 24.20% of the stock is currently owned by insiders.

Institutional Inflows and Outflows

A number of institutional investors have recently modified their holdings of CRWV. MassMutual Private Wealth & Trust FSB boosted its holdings in CoreWeave by 241.1% in the 3rd quarter. MassMutual Private Wealth & Trust FSB now owns 307 shares of the company’s stock valued at $27,000 after purchasing an additional 217 shares in the last quarter. Essential Partners LLC purchased a new stake in shares of CoreWeave in the second quarter valued at about $30,000. Peterson Wealth Services increased its position in CoreWeave by 153.1% during the first quarter. Peterson Wealth Services now owns 405 shares of the company’s stock worth $31,000 after buying an additional 245 shares in the last quarter. Cassaday & Co Wealth Management LLC acquired a new position in CoreWeave in the 1st quarter valued at about $31,000. Finally, Burnham & Co LLC purchased a new position in shares of CoreWeave during the second quarter valued at approximately $32,000.

About CoreWeave

CoreWeave, Inc is a specialized cloud computing company that provides infrastructure designed for artificial intelligence (AI), machine learning, and other high-performance computing workloads. Its platform gives customers access to accelerated computing resources, including graphics processing units (GPUs), along with the networking, storage, and software tools needed to develop, train, and deploy demanding applications.

The company offers cloud services for AI model training and inference, visual effects and rendering, scientific computing, and other data-intensive workloads.