Cerebras Systems (NASDAQ:CBRS) Stock Price Down 5.1% - Time to Sell?

Key Points

• Cerebras shares fell 5.1% to $141.48 in heavy trading, with volume 49% above the average session level.
• Analysts remain broadly optimistic, with a “Moderate Buy” consensus rating and an average price target of $299.90, despite one downgrade and several target-price reductions.
• The company reported strong 74.3% year-over-year revenue growth to $209.87 million but missed quarterly EPS estimates by $2.77; insiders also sold about $387.7 million of shares over the past three months.

Cerebras Systems Inc. (NASDAQ:CBRS - Get Free Report) dropped 5.1% on Wednesday. The stock traded as low as $139.91 and last traded at $141.48. 11,035,359 shares changed hands during mid-day trading, an increase of 49% from the average session volume of 7,420,133 shares. The stock had previously closed at $149.09.

Analyst Ratings Changes

CBRS has been the subject of several analyst reports. Weiss Ratings downgraded shares of Cerebras Systems from a "sell (d)" rating to a "sell (d-)" rating in a report on Friday, September 25th. Rosenblatt Securities reissued a "buy" rating and set a $300.00 target price on shares of Cerebras Systems in a research note on Wednesday, August 19th. Jefferies Financial Group upgraded shares of Cerebras Systems to an "outperform" rating in a research note on Monday, October 5th. Needham & Company LLC reaffirmed a "buy" rating and set a $300.00 target price on shares of Cerebras Systems in a research note on Wednesday, August 19th. Finally, Citigroup lowered their price target on Cerebras Systems from $340.00 to $320.00 and set a "buy" rating on the stock in a report on Thursday, August 13th. Two research analysts have rated the stock with a Strong Buy rating, ten have assigned a Buy rating, one has assigned a Hold rating and one has given a Sell rating to the company's stock. According to MarketBeat, Cerebras Systems has an average rating of "Moderate Buy" and a consensus target price of $299.90.

Cerebras Systems Price Performance

The company has a debt-to-equity ratio of 0.02, a current ratio of 5.82 and a quick ratio of 5.80. The stock has a fifty day moving average price of $196.51. The stock has a market capitalization of $33.61 billion and a PE ratio of -1,768.50.

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

Insiders Place Their Bets

In related news, COO Dhiraj Mallick sold 396,000 shares of the firm's stock in a transaction that occurred on Tuesday, September 29th. The shares were sold at an average price of $204.04, for a total transaction of $80,799,840.00. Following the completion of the sale, the chief operating officer directly owned 396,000 shares in the company, valued at approximately $80,799,840. This trade represents a 50.00% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, 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 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 transaction of $25,076,400.00. Following the completion of the transaction, the chief technology officer owned 309,569 shares in the company, valued at approximately $64,690,633.93. This trade represents a 27.93% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last three months, insiders sold 1,864,452 shares of company stock worth $387,680,754.

Institutional Investors Weigh In On Cerebras Systems

Hedge funds have recently modified their holdings of the stock. Wealth Enhancement Trust Services Inc. acquired a new stake in Cerebras Systems during the 3rd quarter worth about $26,000. GK Wealth Management LLC purchased a new position in Cerebras Systems during the 3rd quarter worth approximately $31,000. Silicon Valley Capital Partners purchased a new stake in shares of Cerebras Systems in the second quarter valued at $44,000. CoreCap Advisors LLC purchased a new position in shares of Cerebras Systems during the third quarter valued at $52,000. Finally, IFP Advisors Inc acquired a new position in Cerebras Systems during the second quarter valued at $169,000.

Cerebras Systems Company Profile

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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