Cerebras Systems (NASDAQ:CBRS) Stock Price Up 7.9% - Time to Buy?

Key Points

• Cerebras shares rose 7.9% to $101.08 in Wednesday trading, with volume 13% above its daily average.
• Investors are watching the company’s Q3 results, expected Nov. 12. Analysts cite AI-inference demand and cloud adoption as potential positives, while losses, margins and valuation remain risks.
• Analysts’ consensus rating is Moderate Buy, with an average price target of $261.80; meanwhile, company insiders sold about 1.9 million shares worth $394.6 million last quarter.

Cerebras Systems Inc. (NASDAQ:CBRS - Get Free Report)'s stock price was up 7.9% during mid-day trading on Wednesday. The company traded as high as $103.23 and last traded at $101.08. Approximately 8,970,271 shares traded hands during trading, an increase of 13% from the average daily volume of 7,961,159 shares. The stock had previously closed at $93.66.

Top Cerebras Systems Stories

Investors following CBRS have been watching these stories:

• Positive Sentiment: Pre-earnings coverage points to strong AI inference demand and growing cloud adoption, while one report says Wedbush remains bullish and expects another earnings beat. These expectations may support sentiment ahead of the company’s Q3 report. Cerebras tipped for another earnings beat
• Neutral Sentiment: Investors are focused on the Q3 results expected Nov. 12. Earnings previews flag demand and cloud adoption as potential strengths, but margins, ongoing losses and valuation are key risks to watch. Should You Buy, Sell, or Hold Cerebras Systems Stock Before Q3 Earnings?
• Negative Sentiment: Cerebras’ lock-up expiration could allow insiders or early investors to sell shares, raising concerns about added supply. Separately, Pomerantz LLP said it is investigating claims on behalf of investors; the announcement does not establish wrongdoing. Cerebras lock-up expires ahead of Q3 results Pomerantz investor investigation announcement

Analysts Set New Price Targets

Several equities research analysts recently issued reports on CBRS shares. Freedom Capital upgraded Cerebras Systems from a "hold" rating to a "strong-buy" rating in a research note on Friday, October 2nd. Rosenblatt Securities restated a "buy" rating and set a $300.00 price objective on shares of Cerebras Systems in a research note on Wednesday, August 19th. Mizuho dropped their price objective on Cerebras Systems from $310.00 to $300.00 and set an "outperform" rating for the company in a report on Thursday, August 13th. Citigroup cut their target price on Cerebras Systems from $340.00 to $320.00 and set a "buy" rating for the company in a research report on Thursday, August 13th. Finally, UBS Group reduced their target price on Cerebras Systems from $330.00 to $250.00 and set a "buy" rating on the stock in a report on Monday, November 2nd. Two investment analysts have rated the stock with a Strong Buy rating, ten have issued a Buy rating, one has issued a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat, Cerebras Systems currently has a consensus rating of "Moderate Buy" and an average price target of $261.80.

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 firm has a market capitalization of $24.01 billion and a P/E ratio of -1,263.50. The firm has a fifty day simple moving average of $155.82.

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

Insider Buying and Selling

In related news, CTO Sean Lie sold 60,000 shares of the stock in a transaction that occurred on Tuesday, October 27th. The shares were sold at an average price of $115.79, for a total value of $6,947,400.00. Following the completion of the transaction, the chief technology officer owned 263,592 shares of the company's stock, valued at $30,521,317.68. This represents a 18.54% decrease in their position. The sale 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, COO Dhiraj Mallick sold 396,000 shares of the 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 transaction, the chief operating officer directly owned 396,000 shares of the company's stock, valued at approximately $80,799,840. The trade was a 50.00% 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. Insiders sold a total of 1,924,452 shares of company stock worth $394,628,154 in the last quarter.

Institutional Investors Weigh In On Cerebras Systems

Hedge funds have recently modified their holdings of the company. Washington University increased its holdings in Cerebras Systems by 175.3% in the 3rd quarter. Washington University now owns 1,517,400 shares of the company's stock worth $269,566,000 after purchasing an additional 966,314 shares in the last quarter. Value Aligned Research Advisors LLC acquired a new position in shares of Cerebras Systems in the second quarter valued at approximately $241,934,000. Wellington Management Group LLP acquired a new position in shares of Cerebras Systems in the second quarter valued at approximately $194,853,000. Lunate Capital Ltd bought a new position in Cerebras Systems in the 3rd quarter valued at approximately $115,351,000. Finally, Sumitomo Mitsui Trust Group Inc. raised its holdings in Cerebras Systems by 59.6% in the 3rd quarter. Sumitomo Mitsui Trust Group Inc. now owns 490,139 shares of the company's stock valued at $87,073,000 after buying an additional 183,035 shares during the last quarter.

About Cerebras Systems

Cerebras Systems develops computing systems and software designed for artificial intelligence and other compute-intensive workloads. Its products are built around the Wafer-Scale Engine, a large processor designed to support AI model training and inference, and include the CS-3 system and related software. The company also offers cloud-based access to its AI computing infrastructure, giving customers a way to run AI workloads without deploying its systems on site. Its offerings are aimed at organizations developing and operating large AI models, including businesses, research institutions and public-sector customers.

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