Cerebras Systems Inc.'s Lock-Up Period Will End on November 10th (NASDAQ:CBRS)

Key Points

• Cerebras Systems’ lock-up period expires November 10, allowing major shareholders and insiders to sell shares from the company’s 30 million-share IPO.
• Analysts remain generally positive, with a consensus “Moderate Buy” rating and an average price target of $281.90, although the stock opened at $96.36 after falling 11.7%.
• The company reported a sharp quarterly EPS miss at $2.98 below expectations, despite 74.3% year-over-year revenue growth; insiders also sold approximately $394.6 million of stock over the past three months.

Cerebras Systems' (NASDAQ:CBRS - Get Free Report) lock-up period is set to expire on Tuesday, November 10th. Cerebras Systems had issued 30,000,000 shares in its initial public offering on May 14th. The total size of the offering was $5,550,000,000 based on an initial share price of $185.00. Shares of the company owned by major shareholders and company insiders will be eligible for trade following the expiration of the lock-up period.

Analyst Ratings Changes

CBRS has been the topic of several recent research reports. Rosenblatt Securities reiterated a "buy" rating and issued a $300.00 price target on shares of Cerebras Systems in a report on Wednesday, August 19th. Freedom Capital upgraded Cerebras Systems from a "hold" rating to a "strong-buy" rating in a research report on Friday, October 2nd. Citigroup dropped their price objective on Cerebras Systems from $340.00 to $320.00 and set a "buy" rating for the company in a report on Thursday, August 13th. Needham & Company LLC restated a "buy" rating and set a $300.00 target price on shares of Cerebras Systems in a research report on Wednesday, August 19th. Finally, Jefferies Financial Group upgraded shares of Cerebras Systems to an "outperform" rating in a research report on Monday, October 5th. Two analysts have rated the stock with a Strong Buy rating, ten have issued a Buy rating, one has given a Hold rating and one has assigned a Sell rating to the company's stock. Based on data from MarketBeat, the company has an average rating of "Moderate Buy" and an average target price of $281.90.

Cerebras Systems Stock Down 11.7%

Shares of CBRS stock opened at $96.36 on Tuesday. The firm has a 50 day simple moving average of $166.82. The company has a current ratio of 5.82, a quick ratio of 5.80 and a debt-to-equity ratio of 0.02. Cerebras Systems has a 52-week low of $95.03 and a 52-week high of $386.34.

Cerebras Systems (NASDAQ:CBRS - Get Free Report) last issued its earnings results on Wednesday, August 12th. The company reported ($2.98) EPS for the quarter, missing the consensus estimate of ($0.21) by ($2.77). The business had revenue of $209.87 million for the quarter. The company's quarterly revenue was up 74.3% on a year-over-year basis. As a group, sell-side analysts expect that Cerebras Systems will post -0.52 earnings per share for the current fiscal year.

Insiders Place Their Bets

In related news, CTO Sean Lie sold 710,247 shares of Cerebras Systems stock in a transaction on Thursday, August 20th. The stock was sold at an average price of $207.86, for a total transaction of $147,631,941.42. Following the completion of the sale, the chief technology officer directly owned 368,926 shares of the company's stock, valued at $76,684,958.36. The trade was a 65.81% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, COO Dhiraj Mallick sold 396,000 shares of the company's stock in a transaction dated Tuesday, September 29th. The shares were sold at an average price of $204.04, for a total value of $80,799,840.00. Following the completion of the sale, the chief operating officer owned 396,000 shares of the company's stock, valued at $80,799,840. This represents a 50.00% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 1,924,452 shares of company stock worth $394,628,154 over the last three months.

Institutional Trading of Cerebras Systems

A number of institutional investors and hedge funds have recently modified their holdings of the stock. Value Aligned Research Advisors LLC acquired a new stake in shares of Cerebras Systems in the 2nd quarter valued at approximately $241,934,000. Wellington Management Group LLP bought a new position in Cerebras Systems during the 2nd quarter worth approximately $194,853,000. Sumitomo Mitsui Trust Group Inc. boosted its stake in Cerebras Systems by 59.6% during the 3rd quarter. Sumitomo Mitsui Trust Group Inc. now owns 490,139 shares of the company's stock worth $87,073,000 after acquiring an additional 183,035 shares during the last quarter. State Street Corp acquired a new position in Cerebras Systems during the second quarter valued at approximately $105,343,000. Finally, Dragoneer Investment Group LLC acquired a new position in Cerebras Systems during the second quarter valued at approximately $88,400,000.

About Cerebras Systems

Cerebras Systems is a technology company that develops specialized computing systems for artificial intelligence and high-performance computing. Its core product is the Wafer-Scale Engine, a processor designed to provide large-scale computing capacity and high-speed data movement for training and running AI models.

The company offers integrated AI computing systems, including the Cerebras CS series, which combines its wafer-scale processors with supporting hardware and software. Cerebras also provides access to its technology through cloud-based services, enabling businesses, research organizations and other users to develop and deploy AI applications without operating the underlying systems themselves.

Founded in 2015 and headquartered in Sunnyvale, California, Cerebras serves customers in sectors such as technology, government, scientific research and other data-intensive industries.

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