Cerebras Systems (NASDAQ:CBRS) Shares Down 11.7% After Analyst Downgrade

Key Points

• Cerebras Systems shares fell 11.7% to $96.36 after UBS cut its price target from $330 to $250, despite maintaining a Buy rating. Trading volume rose 67% above the average.
• Analyst sentiment remains generally positive, with a consensus rating of Moderate Buy and an average price target of $281.90, although several firms have recently lowered their targets.
• Company insiders sold nearly 1.92 million shares worth $394.6 million over the past 90 days. Cerebras also reported a quarterly EPS loss of $2.98, far below the $0.21 loss analysts expected, despite 74.3% year-over-year revenue growth.

Cerebras Systems Inc. (NASDAQ:CBRS - Get Free Report)'s share price traded down 11.7% during trading on Monday after UBS Group lowered their price target on the stock from $330.00 to $250.00. UBS Group currently has a buy rating on the stock. Cerebras Systems traded as low as $95.03 and last traded at $96.36. 13,022,764 shares were traded during trading, an increase of 67% from the average daily volume of 7,820,107 shares. The stock had previously closed at $109.18.

Other equities research analysts have also recently issued reports about the company. TD Cowen dropped their price target on Cerebras Systems from $275.00 to $175.00 and set a "buy" rating for the company in a report on Monday, October 19th. Morgan Stanley boosted their price objective on Cerebras Systems from $273.00 to $279.00 and gave the stock an "overweight" rating in a research note on Thursday, August 13th. Wall Street Zen upgraded Cerebras Systems from a "sell" rating to a "hold" rating in a report on Saturday, August 15th. Citigroup lowered their target price on Cerebras Systems from $340.00 to $320.00 and set a "buy" rating for the company in a research note on Thursday, August 13th. Finally, Freedom Capital raised Cerebras Systems from a "hold" rating to a "strong-buy" rating in a report on Friday, October 2nd. Two research analysts have rated the stock with a Strong Buy rating, ten have issued a Buy rating, one has assigned a Hold rating and one has issued a Sell rating to the company's stock. Based on data from MarketBeat, Cerebras Systems currently has an average rating of "Moderate Buy" and a consensus price target of $281.90.

Insider Buying and Selling at Cerebras Systems

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

Institutional Investors Weigh In On Cerebras Systems

Several institutional investors have recently modified their holdings of CBRS. Commonwealth Equity Services LLC boosted its stake in Cerebras Systems by 205.2% in the third quarter. Commonwealth Equity Services LLC now owns 6,992 shares of the company's stock valued at $1,242,000 after acquiring an additional 4,701 shares during the last quarter. Kestra Private Wealth Services LLC raised its position in shares of Cerebras Systems by 91.0% during the 3rd quarter. Kestra Private Wealth Services LLC now owns 5,860 shares of the company's stock valued at $1,041,000 after acquiring an additional 2,792 shares during the last quarter. Chicago Partners Investment Group LLC bought a new stake in shares of Cerebras Systems during the 3rd quarter valued at $240,000. Torren Management LLC acquired a new position in shares of Cerebras Systems in the 3rd quarter valued at $39,000. Finally, Blue Bell Private Wealth Management LLC acquired a new position in shares of Cerebras Systems in the 3rd quarter valued at $31,000.

Cerebras Systems Trading Down 11.7%

The company has a debt-to-equity ratio of 0.02, a quick ratio of 5.80 and a current ratio of 5.82. The company has a market capitalization of $22.89 billion and a P/E ratio of -1,204.50. The company's 50 day simple moving average is $168.82.

Cerebras Systems (NASDAQ:CBRS - Get Free Report) last announced its quarterly earnings data on Wednesday, August 12th. The company reported ($2.98) EPS for the quarter, missing analysts' consensus estimates of ($0.21) by ($2.77). The company had revenue of $209.87 million during the quarter. The business's revenue for the quarter was up 74.3% compared to the same quarter last year. On average, equities analysts forecast that Cerebras Systems Inc. will post -0.52 EPS for the current fiscal year.

Cerebras Systems Company Profile

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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