Cerebras Systems (NASDAQ:CBRS) Stock Falls 6.1% – Should You Sell?

Cerebras Systems Inc. (NASDAQ:CBRS)’s share price dropped 6.1% on Wednesday. The company traded as low as $90.28 and last traded at $91.85. 10,072,201 shares were traded during trading, an increase of 28% from the average session volume of 7,845,789 shares. The stock had previously closed at $97.82.

Trending Headlines about Cerebras Systems

Here are the key news stories impacting Cerebras Systems this week:

• Positive Sentiment: UBS maintains a Buy rating and sees substantial potential upside, though it cut its price target from $330 to $250. A separate Wall Street analyst cited a possible path to gains of about 240%, reflecting how bullish forecasts contrast with the recent selloff. Cerebras Sinks 11% in a Week to a New 52-Week Low. UBS Still Sees 159% Upside Cerebras Systems Craters Again
• Positive Sentiment: Investors will look to Q3 results for evidence supporting the company’s growth outlook. One analysis cites revenue consensus of $214.7 million, more than 600MW of secured capacity, and management’s expectation of over threefold revenue growth in 2027. Planned inference work with AMD and AWS could also improve throughput and revenue per megawatt, though execution remains key. Cerebras: Q3 Could Validate The 2027 Story
• Negative Sentiment: A report says CBRS shares came under pressure following an analyst downgrade. The stock has also reached a new 52-week low, underscoring the severity of the recent decline. Cerebras Systems Shares Down Following Analyst Downgrade
• Negative Sentiment: Other reported headwinds include a short report, substantial insider selling, and rumors that a major customer may have left. These claims could weigh on sentiment; the customer report is described as a rumor, not a confirmed departure. Cerebras Systems Craters Again
• Negative Sentiment: Several law firms have announced investigations into Cerebras concerning potential securities-law violations. These are investigations, not findings of wrongdoing, but may add uncertainty and reputational risk. Investor Alert: Investigation Into Cerebras Systems

Wall Street Analyst Weigh In

CBRS has been the subject of several recent research reports. UBS Group decreased their price objective on Cerebras Systems from $330.00 to $250.00 and set a “buy” rating for the company in a research note on Monday. Wall Street Zen upgraded shares of Cerebras Systems from a “sell” rating to a “hold” rating in a research note on Saturday, August 15th. Mizuho reduced their target price on shares of Cerebras Systems from $310.00 to $300.00 and set an “outperform” rating on the stock in a report on Thursday, August 13th. Rosenblatt Securities reiterated a “buy” rating and issued a $300.00 price target on shares of Cerebras Systems in a research note on Wednesday, August 19th. Finally, Citigroup lowered their price target on shares of Cerebras Systems from $340.00 to $320.00 and set a “buy” rating for the company in a report on Thursday, August 13th. Two analysts have rated the stock with a Strong Buy rating, ten have given a Buy rating, one has assigned a Hold rating and one has given a Sell rating to the company’s stock. According to data from MarketBeat.com, Cerebras Systems presently has a consensus rating of “Moderate Buy” and a consensus target price of $281.90.

Cerebras Systems Trading Down 6.2%

The firm has a market cap of $21.80 billion and a PE ratio of -1,147.25. The stock has a 50 day simple moving average of $165.07. The company has a debt-to-equity ratio of 0.02, a quick ratio of 5.80 and a current ratio of 5.82.

Cerebras Systems (NASDAQ:CBRS) last posted its quarterly earnings data on Wednesday, August 12th. The company reported ($2.98) earnings per share for the quarter, missing analysts’ consensus estimates of ($0.21) by ($2.77). The company had revenue of $209.87 million for the quarter. Cerebras Systems’s revenue was up 74.3% on a year-over-year basis. On average, sell-side analysts predict that Cerebras Systems Inc. will post -0.52 EPS for the current year.

Insider Activity

In related news, CAO Yagnesh Patel sold 1,320 shares of the stock in a transaction dated Monday, September 28th. The stock was sold at an average price of $204.50, for a total transaction of $269,940.00. Following the transaction, the chief accounting officer directly owned 15,356 shares in the company, valued at approximately $3,140,302. This represents a 7.92% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, COO Dhiraj Mallick sold 396,000 shares of Cerebras Systems stock in a transaction on Tuesday, September 29th. The shares were sold at an average price of $204.04, for a total transaction of $80,799,840.00. Following the completion of the transaction, the chief operating officer owned 396,000 shares in the company, valued at approximately $80,799,840. This trade represents a 50.00% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 1,924,452 shares of company stock worth $394,628,154 in the last quarter.

Hedge Funds Weigh In On Cerebras Systems

Institutional investors have recently made changes to their positions in the business. Value Aligned Research Advisors LLC bought a new stake in Cerebras Systems during the second quarter worth about $241,934,000. Wellington Management Group LLP bought a new stake in shares of Cerebras Systems during the second quarter valued at approximately $194,853,000. State Street Corp acquired a new stake in shares of Cerebras Systems in the second quarter valued at approximately $105,343,000. Dragoneer Investment Group LLC acquired a new stake in shares of Cerebras Systems in the second quarter valued at approximately $88,400,000. Finally, Sumitomo Mitsui Trust Group Inc. increased its holdings in shares of Cerebras Systems by 59.6% in the third quarter. Sumitomo Mitsui Trust Group Inc. now owns 490,139 shares of the company’s stock valued at $87,073,000 after purchasing an additional 183,035 shares in the last quarter.

Cerebras Systems Company Profile

Cerebras Systems is a technology company that develops specialized computing systems for artificial intelligence and high-performance computing. Its core product is the Wafer-Scale Engine, a processor designed to provide large-scale computing capacity and high-speed data movement for training and running AI models.

The company offers integrated AI computing systems, including the Cerebras CS series, which combines its wafer-scale processors with supporting hardware and software. Cerebras also provides access to its technology through cloud-based services, enabling businesses, research organizations and other users to develop and deploy AI applications without operating the underlying systems themselves.

Founded in 2015 and headquartered in Sunnyvale, California, Cerebras serves customers in sectors such as technology, government, scientific research and other data-intensive industries.