CoreWeave (NASDAQ:CRWV) Shares Gap Up Following Analyst Upgrade

Key Points

• Goldman Sachs upgraded CoreWeave to Buy from Neutral, sending shares from a $61.39 close to a $65.82 open. Goldman set a $106 price target, citing strong demand for the company’s AI infrastructure.
• Analyst sentiment remains mixed: 25 analysts rate the stock Buy, seven Hold, and three Sell, producing a Moderate Buy consensus and average price target of $137.35.
• Growth is accompanied by significant risks. Revenue rose 112.5% year over year and the company reported a $104 billion backlog, but it remains unprofitable, highly leveraged, and insiders have sold substantial amounts of stock, including shares sold to cover tax obligations.

CoreWeave Inc. (NASDAQ:CRWV - Get Free Report)'s share price gapped up before the market opened on Monday after The Goldman Sachs Group upgraded the stock from a neutral rating to a buy rating. The stock had previously closed at $61.39, but opened at $65.82. The Goldman Sachs Group now has a $106.00 price target on the stock. CoreWeave shares last traded at $61.37, with a volume of 18,151,135 shares trading hands.

Several other equities research analysts have also recently weighed in on the stock. Rothschild & Co Redburn started coverage on shares of CoreWeave in a research report on Monday, September 21st. They issued a "sell" rating and a $54.00 price target for the company. Barclays lifted their price objective on shares of CoreWeave from $90.00 to $105.00 and gave the company an "equal weight" rating in a report on Thursday, August 13th. Mizuho reduced their price objective on shares of CoreWeave from $115.00 to $88.00 and set a "neutral" rating for the company in a research note on Thursday. Raymond James Financial downgraded CoreWeave from a "moderate buy" rating to a "hold" rating in a report on Wednesday, July 22nd. Finally, Citigroup boosted their price target on CoreWeave from $142.00 to $159.00 and gave the stock a "buy" rating in a research report on Friday, August 14th. Twenty-five equities research analysts have rated the stock with a Buy rating, seven have issued a Hold rating and three have issued a Sell rating to the stock. Based on data from MarketBeat, the company has a consensus rating of "Moderate Buy" and an average price target of $137.35.

Insider Activity at CoreWeave

In other CoreWeave news, CRO Jonathan Jones sold 21,569 shares of the firm's stock in a transaction that occurred on Tuesday, October 13th. The shares were sold at an average price of $77.42, for a total value of $1,669,871.98. Following the completion of the sale, the executive directly owned 5,392 shares in the company, valued at $417,448.64. This trade represents a 80.00% decrease in their ownership of the stock. The sale 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. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Michael N. Intrator sold 78,552 shares of the firm's stock in a transaction that occurred on Wednesday, September 30th. The shares were sold at an average price of $87.69, for a total transaction of $6,888,224.88. Following the completion of the sale, the chief executive officer owned 548,935 shares of the company's stock, valued at approximately $48,136,110.15. This trade represents a 12.52% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold a total of 5,660,270 shares of company stock valued at $495,848,089 over the last three months. Company insiders own 24.20% of the company's stock.

Key CoreWeave News

Here are the key news stories impacting CoreWeave this week:

• Positive Sentiment: Goldman Sachs upgrade: The analyst firm cited sufficient demand for CoreWeave’s AI infrastructure and sees substantial upside from current levels. The upgrade was the primary catalyst behind the stock’s advance. CoreWeave Jumps 6% on Goldman Sachs Upgrade
• Positive Sentiment: AI demand remains a supporting factor: CoreWeave has reported a roughly $104 billion backlog, while technology analyst Dan Ives characterized the recent sell-off as a “false narrative” and viewed the decline as a potential buying opportunity. Investor Cathie Wood’s funds also reportedly added to their CoreWeave position. Dan Ives Calls CoreWeave Sell-Off a False Narrative
• Neutral Sentiment: Conflicting analyst views: MoffettNathanson reduced its CoreWeave price target to $89 from $107, showing that analysts remain divided over the company’s valuation and financial risk. CoreWeave Price Target Lowered at MoffettNathanson
• Negative Sentiment: Balance-sheet and insider-selling concerns persist: CoreWeave’s high debt burden, elevated bond yields, weak liquidity and projected leverage continue to raise refinancing and shareholder-dilution risks. Reports that the CEO and co-founders have sold billions of dollars of stock add to investor caution. CoreWeave’s 15% Bond Yield

Institutional Inflows and Outflows

Hedge funds have recently added to or reduced their stakes in the business. Parallel Advisors LLC grew its holdings in CoreWeave by 4.0% in the first quarter. Parallel Advisors LLC now owns 2,340 shares of the company's stock valued at $181,000 after purchasing an additional 91 shares during the period. Pathway Wealth Management LLC raised its stake in shares of CoreWeave by 2.9% during the 1st quarter. Pathway Wealth Management LLC now owns 3,593 shares of the company's stock worth $278,000 after buying an additional 100 shares during the period. Azzad Asset Management Inc. ADV raised its stake in shares of CoreWeave by 2.1% during the 1st quarter. Azzad Asset Management Inc. ADV now owns 5,020 shares of the company's stock worth $389,000 after buying an additional 104 shares during the period. WPG Advisers LLC raised its stake in shares of CoreWeave by 14.1% during the 1st quarter. WPG Advisers LLC now owns 1,159 shares of the company's stock worth $90,000 after buying an additional 143 shares during the period. Finally, Sequoia Financial Advisors LLC lifted its position in shares of CoreWeave by 3.6% during the 2nd quarter. Sequoia Financial Advisors LLC now owns 4,128 shares of the company's stock valued at $411,000 after buying an additional 145 shares in the last quarter.

CoreWeave Stock Up 2.6%

The stock has a market cap of $28.90 billion, a PE ratio of -17.18 and a beta of 7.36. The company has a current ratio of 0.46, a quick ratio of 0.46 and a debt-to-equity ratio of 5.53. The business has a 50-day moving average price of $87.01 and a 200-day moving average price of $94.60.

CoreWeave (NASDAQ:CRWV - Get Free Report) last released its quarterly earnings results on Tuesday, August 11th. The company reported ($1.14) earnings per share (EPS) for the quarter, beating analysts' consensus estimates of ($1.52) by $0.38. The firm had revenue of $2.58 billion for the quarter. CoreWeave had a negative net margin of 25.41% and a negative return on equity of 47.95%. CoreWeave's revenue was up 112.5% compared to the same quarter last year. During the same period in the prior year, the business posted ($0.27) EPS. As a group, analysts forecast that CoreWeave Inc. will post -5.19 earnings per share for the current year.

CoreWeave Company Profile

CoreWeave, Inc is a specialized cloud computing company that provides infrastructure designed for artificial intelligence (AI), machine learning, and other high-performance computing workloads. Its platform gives customers access to accelerated computing resources, including graphics processing units (GPUs), along with the networking, storage, and software tools needed to develop, train, and deploy demanding applications.

The company offers cloud services for AI model training and inference, visual effects and rendering, scientific computing, and other data-intensive workloads.

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