From 24/7 Wall St. · Alex Sirois · · 1m 10s
Coreweave's Shock Absorber Function Will Be Tested Again
Coreweave's stock tests NVIDIA's AI financing as debt pressures mount.
In brief
Coreweave's stock tests NVIDIA's AI financing as debt pressures mount. Coreweave's stock falls 25% in a week as it tests NVIDIA's AI financing capacity with $104 billion backlog and $640 million interest expense. Originally reported by 24/7 Wall St..
Coreweave's Stock as Shock Proxy
Coreweave trades at $61.39 and acts as the market's shock proxy for NVIDIA's AI financing concerns.
“I'm optimistic. Their cost of capital is actually decreasing.”
Coreweave's $104 Billion Backlog
Second-quarter revenue rose 112.3% to $2.58 billion with a $104 billion backlog before $25 billion in new commitments.
Coreweave's Debt Structure
Coreweave carries debt-to-equity of 8.94 and interest coverage of -0.04 with $640 million interest expense.
NVIDIA's Financing Concerns
NVIDIA says its compute is 'fully utilized' but management calls this circular financing with redeployable capacity.
“fully utilized across every cloud we serve”
Customer Concentration Risks
Coreweave's customer concentration in Meta Platforms, OpenAI and Microsoft adds to financing pressure.
Analyst Sentiment
42 analysts target $140.58 with 8 strong buys, 23 buys, 8 holds, 2 sells, and 1 strong sell.
Coreweave's Next Test
Coreweave's stock will test when income outruns interest expense to stop absorbing market fear.
The key point
Coreweave's stock falls 25% in a week as it tests NVIDIA's AI financing capacity with $104 billion backlog and $640 million interest expense.
