Here’s How Much Traders Expect CoreWeave Stock To Move After Earnings on Monday
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Key Takeaways
- Options pricing suggests traders anticipate shares of CoreWeave could rise or fall up to 14% this week.
- The cloud computing company is expected to say its losses narrowed and revenue more than doubled from last year when it reports third-quarter earnings after the closing bell on Monday.
- CoreWeave has only reported earnings twice since going public in March; the stock, after big run-ups into those prints, fell on both occasions.
CoreWeave (CRWV) is slated to report third-quarter results after the closing bell on Monday, with traders expecting a big post-earnings move for the stock.
Options pricing suggests traders anticipate shares of CoreWeave could move up to 14% in either direction by the end of this week. A move of that size would push the stock up to $118.70 at the high end, erasing some of the losses incurred amid last week’s slump in tech stocks, or drag it down to $89.30, its lowest price since early September.
CoreWeave has only reported quarterly results twice since it began trading, and neither has helped the stock. In May, shares fell more than 2% the day after the company’s earnings were released, despite better-than-expected results, with revenue increasing more than 400% year-over-year. Shares tumbled more than 20% after earnings in August, when the company reported a wider-than-expected loss.
Why This Is Important
CoreWeave shares have soared since debuting in March, with investors looking past the company’s unprofitability to focus on surging revenue driven by AI demand. How investors react to the company’s results on Monday could reflect Wall Street’s risk appetite and sentiment pertaining to the AI stock rally.
Granted, CoreWeave’s shares advanced considerably leading up to both prints. The stock gained nearly 70% between its late-March IPO and May’s report, and rose about 120% heading into August’s results. This time could be different. Leading into Monday’s session, CoreWeave shares were down about 30% since its last earnings.
CoreWeave’s revenue has soared in the last year and a half amid a surge in demand for AI-enabling cloud computing platforms. The company landed several major customers last quarter, signing a $14 billion deal with Meta Platforms (META), a $6 billion deal with Nvidia (NVDA), and a $6.5 billion expansion of its existing agreement with ChatGPT maker OpenAI.
The cloud computing provider is expected to report a third-quarter net loss of $284.4 million, narrowing from a loss of $359.8 million in the year ago quarter. Its revenue is projected to jump 120% year-over-year to $1.3 billion, according to analyst estimates compiled by Visible Alpha.
Wall Street is split on the outlook for CoreWeave’s stock, with five of the 10 analysts with current ratings tracked by Visible Alpha calling the stock a “buy,” and the other half assigning it a “hold” rating. Their mean target of $158.83 represents about 53% upside from the stock’s closing price last Friday.
