CoreWeave Stock To $53?
CoreWeave (CRWV) stock has fallen 12% during the past week, and is currently trading at $74.92. Our multi-factor assessment suggests that it may be time to sell CRWV stock. We have, overall, a pessimistic view of the stock, and a price of $53 may not be out of reach. We believe there is a near-equal mix of good and bad in CRWV stock given its overall Moderate operating performance and financial condition. But keeping in mind its Very High valuation, we think that the stock is Unattractive.
Below is our assessment:
| CONCLUSION | |
|---|---|
| What you pay: | |
| Valuation | Very High |
| What you get: | |
| Growth | Strong |
| Profitability | Very Weak |
| Financial Stability | Moderate |
| Downturn Resilience | N/A |
| Operating Performance | Moderate |
| Stock Opinion | Unattractive |
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Let’s get into details of each of the assessed factors but before that, for quick background: With $36 Bil in market cap, CoreWeave provides a cloud platform with proprietary software and services to manage complex AI infrastructure at scale, driving the AI revolution and powering innovation intelligence.
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[1] Valuation Looks Very High
| CRWV | S&P 500 | |
|---|---|---|
| Price-to-Sales Ratio | 10.4 | 3.1 |
| Price-to-Earnings Ratio | -35.9 | 22.9 |
| Price-to-Free Cash Flow Ratio | -4.6 | 19.7 |
This table highlights how CRWV is valued vs broader market.
[2] Growth Is Strong
- Its revenues have grown 0.0% from $NaN to $3.5 Bil in the last 12 months
- Also, its quarterly revenues grew 206.7% to $1.2 Bil in the most recent quarter from $395 Mil a year ago.
| CRWV | S&P 500 | |
|---|---|---|
| 3-Year Average | 5.5% | |
| Latest Twelve Months* | � | 6.1% |
| Most Recent Quarter (YoY)* | 206.7% | 7.1% |
This table highlights how CRWV is growing vs broader market.
[3] Profitability Appears Very Weak
- CRWV last 12 month operating income was $222 Mil representing operating margin of 6.3%
- With cash flow margin of 18.1%, it generated nearly $638 Mil in operating cash flow over this period
- For the same period, CRWV generated nearly $-1.0 Bil in net income, suggesting net margin of about -28.8%
| CRWV | S&P 500 | |
|---|---|---|
| Current Operating Margin | 6.3% | 18.8% |
| Current OCF Margin | 18.1% | 20.5% |
| Current Net Income Margin | -28.8% | 13.1% |
This table highlights how CRWV profitability vs broader market.
[4] Financial Stability Looks Moderate
- CRWV Debt was $15 Bil at the end of the most recent quarter, while its current Market Cap is $36 Bil. This implies Debt-to-Equity Ratio of 39.9%
- CRWV Cash (including cash equivalents) makes up $1.2 Bil of $26 Bil in total Assets. This yields a Cash-to-Assets Ratio of 4.4%
| CRWV | S&P 500 | |
|---|---|---|
| Current Debt-to-Equity Ratio | 39.9% | 21.2% |
| Current Cash-to-Assets Ratio | 4.4% | 7.0% |
[5] Downturn Resilience Is N/A
CRWV has fared much worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.
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