From Startup Fortune · · 1m 10s
Cathie Wood buys CoreWeave as bond traders price default
Cathie Wood's ARK Invest keeps buying CoreWeave stock despite bond traders pricing it for default.
In brief
Cathie Wood's ARK Invest keeps buying CoreWeave stock despite bond traders pricing it for default. Cathie Wood's ARK Invest bought $13.4 million of CoreWeave stock as bond traders priced a 60% default risk within five years. Originally reported by Startup Fortune.
Credit default swaps spike
CoreWeave's five-year credit default swaps hit a record intraday spread of 1,194.5 basis points this week.
Bond yields near 15%
CoreWeave bonds have cratered with yields near 15% implying a high default risk.
ARK buys CoreWeave stock
ARK Invest bought 97,639 shares worth $8.9 million on October 6 and 214,589 shares worth $18.9 million the next day.
ARK continues buying
ARK bought 188,665 shares worth $13.4 million on October 14 and 192,566 shares on October 15.
CoreWeave debt situation
CoreWeave has raised over $35 billion this year with total debt around $52 billion as of June.
CoreWeave's revenue backlog
CoreWeave's revenue backlog exceeds $100 billion in contracted future business.
Stock price drop
CoreWeave shares are down 53% year-over-year as of mid-October.
Nvidia's stake
Nvidia CEO Jensen Huang said CoreWeave's business strength is improving every day.
What matters most
Cathie Wood's ARK Invest bought $13.4 million of CoreWeave stock as bond traders priced a 60% default risk within five years.
