Key Points
- CoreWeave insiders are selling shares, but investors should think twice; AI demand is robust, fueling a healthy revenue growth and profitability outlook.
- Analysts and institutions are buying this stock, providing a solid support base in Q4.
- The forecast for Q3 results is likely to be low, setting the company up for outperformance and a catalyst for higher share prices.
CoreWeave (NASDAQ: CRWV) insiders are selling shares, but investors should think twice before closing positions or going short. While there are concerns, the demand for AI-centric data center computing capabilities and NVIDIA (NASDAQ: NVDA) GPU-as-a-service is tremendous, fueling a robust growth and profitability outlook.
The consensus figures as of late October suggest this company's revenue will grow at a high-double-digit compound annual rate for at least the next five years, with profitability reached by late 2026/early 2027 and earnings growing robustly afterward.
In this scenario, CoreWeave trades in the low teens relative to forward estimates that are likely to be low. The company's growth trajectory supports its price action, providing potential for a 100% rise over the next few years and an anticipated analyst upgrade cycle.
The trends in late 2025 align with a rising share price, including rapidly increasing coverage, firming sentiment with consensus pegged at Moderate Buy, and a rising price target. The consensus lags the price action in late October but provides market support as it trends higher, up 50% in the preceding 90 days. The high-end range points to $200, a fresh all-time high and a nearly 50% stock price gain when reached.
Likewise, institutional activity also aligns with an outlook for rising share prices. The group bought robustly in Q3 at a pace of more than $2 for every $1 sold and carried a bullish trend into Q4. The balance of activity in the first few weeks of the quarter is approximately $250 million bought, compared with less than $3 million sold, bringing the group's total exposure to nearly 50%, excluding major shareholders and insiders.
Have you heard about this sub $1 company that is making people "Superhumans"?
Investors are calling this a 'massive breakthrough'.
But not for the reason you think...
Investors already having started flooding in to take advantage of this while the company is still private.
But this opportunity won't be around forever... They've officially reserved a Nasdaq ticker and the last chance to invest at current valuation is October 30th.
Click here to get the name of the company and secure your shares >>
CoreWeave Insiders Sell Shares as Lock-Up Expires
CoreWeave insiders, including the CEO, CFO, CSO, CDO, GC, SVP, founders, and directors, have sold shares since March. In fact, insiders have only sold shares since the IPO; there are no purchases, but investors shouldn't read too much into the news. Most sales align with prearranged trading plans intended to take advantage of the expiring lock-up, and Magnetar Financial, LLC accounts for the bulk of those sales.
Magnetar Financial is an early investor in the business. It is a multi-strategy alternative asset manager that first gained exposure by extending a loan that later evolved into a significant equity position. With shares trading 350% above the IPO price, taking some profits off the table was prudent.
The critical takeaway is that insiders still own a significant 25% of the business and provide a solid support base. The risk is that insider selling will persist in the coming quarters, keeping volatility high.
Short Interest Is a Risk for CoreWeave Investors
CoreWeave's short interest poses a near-term threat to its investors. Short interest has grown steadily over the past two months, reaching a record high of more than 10% in early October. 10% is not insurmountable, but it could continue to trend higher, and the threat of insider selling adds to the risks.
The takeaway is that CoreWeave's volatility is likely to remain high for the foreseeable future, and there is potential for significant stock price corrections until the shorts exit the market. The critical support levels are near $130, $120, and $100.
Price action reflects volatility induced by insider and short selling, with the stock price having corrected by more than 50% from its peak, and by analysts, with the October rebound strong.
The next visible catalyst is the Q3 earnings release, scheduled for mid-November, in which analysts forecast a high-single-digit sequential revenue growth but have set the bar low with downward revisions.
The likely outcome, assuming CoreWeave delivers results similar to those of other AI-centric businesses, is significant outperformance and favorable guidance.
Read this article online ›
Featured Articles:
No comments:
Post a Comment
Keep a civil tongue.