Cerebras Systems (NASDAQ:CBRS) Shares Down 10.5% - Should You Sell?

Key Points

• Cerebras shares fell 10.5% to $127.21 in heavy trading, with volume 55% above the average session level.
• Analysts remain broadly bullish, with a consensus “Moderate Buy” rating and an average price target of $299.90, despite the company’s quarterly loss of $2.98 per share versus the expected $0.21 loss.
• Insiders sold approximately $387.7 million of stock over the past 90 days, including significant sales by the chief technology officer and chief accounting officer under pre-arranged trading plans.

Cerebras Systems Inc. (NASDAQ:CBRS - Get Free Report)'s stock price fell 10.5% during trading on Friday. The company traded as low as $126.05 and last traded at $127.21. 11,575,803 shares changed hands during mid-day trading, an increase of 55% from the average session volume of 7,479,385 shares. The stock had previously closed at $142.17.

Wall Street Analysts Forecast Growth

A number of analysts have commented on the stock. Rosenblatt Securities reaffirmed a "buy" rating and set a $300.00 target price on shares of Cerebras Systems in a report on Wednesday, August 19th. UBS Group lifted their price target on shares of Cerebras Systems from $320.00 to $330.00 and gave the company a "buy" rating in a report on Thursday, August 13th. Citigroup dropped their price target on shares of Cerebras Systems from $340.00 to $320.00 and set a "buy" rating for the company in a research report on Thursday, August 13th. Wedbush lifted their target price on shares of Cerebras Systems from $280.00 to $290.00 and gave the company an "outperform" rating in a research note on Thursday, August 13th. Finally, Mizuho cut their price target on Cerebras Systems from $310.00 to $300.00 and set an "outperform" rating for the company in a research note on Thursday, August 13th. Two analysts have rated the stock with a Strong Buy rating, ten have assigned a Buy rating, one has issued a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $299.90.

Cerebras Systems Stock Performance

The company has a current ratio of 5.82, a quick ratio of 5.80 and a debt-to-equity ratio of 0.02. The business's fifty day moving average is $193.67. The stock has a market cap of $30.22 billion and a price-to-earnings ratio of -1,590.12.

Cerebras Systems (NASDAQ:CBRS - Get Free Report) last posted its earnings results on Wednesday, August 12th. The company reported ($2.98) EPS for the quarter, missing analysts' consensus estimates of ($0.21) by ($2.77). The firm had revenue of $209.87 million during the quarter. The company's quarterly revenue was up 74.3% on a year-over-year basis. Equities analysts forecast that Cerebras Systems Inc. will post -0.52 EPS for the current fiscal year.

Insider Activity at Cerebras Systems

In other news, CAO Yagnesh Patel sold 1,320 shares of the firm's stock in a transaction that occurred on Monday, September 28th. The stock was sold at an average price of $204.50, for a total value of $269,940.00. Following the completion of the sale, the chief accounting officer directly owned 15,356 shares of the company's stock, valued at $3,140,302. This trade represents a 7.92% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CTO Sean Lie sold 120,000 shares of Cerebras Systems stock in a transaction that occurred on Friday, September 25th. The stock was sold at an average price of $208.97, for a total value of $25,076,400.00. Following the completion of the transaction, the chief technology officer owned 309,569 shares of the company's stock, valued at approximately $64,690,633.93. This trade represents a 27.93% 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 a total of 1,864,452 shares of company stock valued at $387,680,754 over the last ninety days.

Institutional Investors Weigh In On Cerebras Systems

Several institutional investors have recently made changes to their positions in CBRS. Wealth Enhancement Trust Services Inc. bought a new position in Cerebras Systems in the 3rd quarter valued at $26,000. GK Wealth Management LLC bought a new stake in shares of Cerebras Systems during the third quarter worth $31,000. Silicon Valley Capital Partners purchased a new stake in shares of Cerebras Systems during the second quarter valued at $44,000. B. Riley Wealth Advisors Inc. boosted its stake in shares of Cerebras Systems by 16.2% during the third quarter. B. Riley Wealth Advisors Inc. now owns 1,588 shares of the company's stock valued at $282,000 after purchasing an additional 221 shares during the period. Finally, Mather Group LLC. bought a new position in shares of Cerebras Systems in the third quarter worth about $44,000.

About Cerebras Systems

Cerebras Systems is an artificial intelligence computing company that develops specialized hardware and software for training and deploying large AI models. The company's technology is designed to address the computational demands of generative AI, deep learning and other data-intensive workloads.

Its core products include the Wafer-Scale Engine, a purpose-built AI processor produced on a single silicon wafer, and the CS-3 AI supercomputer, which incorporates that processor into an integrated computing system.

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