Cathie Wood's ARK Buys CoreWeave Stock Following Overnight Drop
CoreWeave Inc. (CRWV) shares slid nearly 2% in overnight trading, extending losses amid a broader selloff in software equities. Despite the downturn, Cathie Wood's ARK Investment purchased 132,498 shares on Monday, adding positions through two of its exchange-traded funds. The stock has dropped more than 14% year-to-date.
The buying activity comes as market participants evaluate the company's debt profile. CoreWeave held $35.6 billion in total debt as of June 30, with second-quarter net interest expense rising to $640 million from $267 million in the previous year. Research indicates that massive computing infrastructure investments face pressure as upfront costs outpace current cash flows.
Wall Street analysts are split on the equity's direction. MoffettNathanson and BNP Paribas both reduced their price targets, citing high financial obligations and financing costs. However, Goldman Sachs upgraded the stock to Buy with a $106 price target, pointing to tight market supply and expected growth in recurring revenue over the next 24 months.
Key points
- ARK Investment purchased 132,498 shares of CoreWeave Inc. (CRWV) through its ARKK and ARKW exchange-traded funds.
- CoreWeave carried $35.6 billion in total debt as of June 30, with second-quarter net interest expense increasing to $640 million.
- Wall Street views are divided, with target price reductions from MoffettNathanson and BNP Paribas alongside a Goldman Sachs upgrade to Buy.
- CoreWeave shares have declined over 14% year-to-date following a broader pullback across software stocks.
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How we writeDisclaimerQuestions and answers
Why did CoreWeave stock drop?
CoreWeave shares fell amid a broader selloff in software stocks and investor concerns over its $35.6 billion total debt load.
How many CoreWeave shares did ARK Investment purchase?
ARK Investment bought 132,498 shares of CoreWeave across its ARKK and ARKW ETF funds on Monday.
What are Wall Street analysts predicting for CoreWeave?
Wall Street is divided: Goldman Sachs upgraded the stock to Buy with a $106 target, while MoffettNathanson and BNP Paribas lowered their price targets.