Key Takeaways
- Cathie Wood’s ARK Invest, Brad Gerstner’s Altimeter Capital and eight other big funds reported new Cerebras stakes as of June 30, and the stock is down 58% since.
- Several of the same funds held far bigger positions in NVIDIA, Taiwan Semiconductor and Broadcom, which trade below or near their usual multiples.
- Cerebras trades near the lowest multiple of forward sales since it listed, while analysts expect its revenue to more than triple in 2027.
- Cerebras looks like a buy before Thursday’s report as a small position, since one customer, OpenAI, accounts for much of its backlog.
Ten big funds reported new stakes in Cerebras Systems (CBRS) in their 13Fs for the quarter ended June 30. The 13Fs were filed Aug. 13 and 14, and they’re still the latest filings for these funds. The stock has fallen 58% since its June 30 close. And Cerebras reports third-quarter results after the close on Thursday, Nov. 12.
In several of those portfolios, Cerebras sits beside much bigger AI chip bets. Altimeter’s largest holding at June 30 was NVIDIA (NVDA). Chase Coleman’s Tiger Global and Philippe Laffont’s Coatue each had Taiwan Semiconductor (TSM) as their No. 1. And Coatue owned 5.85 million shares of Broadcom (AVGO), 6% more than a quarter earlier.
TIKR tracks 11 analysts on Cerebras Systems. How many say “Buy”?
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Gerstner made it a top-two bet
Altimeter held 7.23 million Cerebras shares worth $1.60 billion at June 30. That was 16.2% of its 13F stocks and its No. 2 position, behind NVIDIA’s 19.2%, so more than a third of Gerstner’s 13F stocks sat in the two chipmakers. Coatue’s 7.01 million shares were worth $1.55 billion, just 3% of its 13F stocks. Atreides Management made Cerebras its No. 3 at 6.2%, plus call options with a notional value of $155 million, and Tiger held 3.00 million shares worth $663 million. ARK’s 764,613 shares, worth $169 million, were 1.1% of its 13F stocks.
Greenoaks, Meridiem Capital Partners, Dragoneer, StepStone and Alpha Wave Global round out the 10. Each had 1.4% to 3.5% of its 13F stocks in Cerebras. A 13F only shows what a fund held on the last day of the quarter. So none of these filings tells us what the funds paid, or whether they still own the stock.
Cerebras’s own numbers held up
Cerebras beat its own guidance in the second quarter. Core revenue more than doubled to $209.9 million, and on Aug. 12 the company raised its 2026 core revenue outlook to $880 million to $890 million. It ended June with a $25.4 billion backlog, which is more than its $22.25 billion market value today. It also had $8.6 billion of cash and investments after its May IPO. CFO Bob Komin said the company plans to “more than triple revenue in 2027.”
The selling started outside the business. In late October, short seller Culper claimed Cerebras’s wafers break down after just two years. Then Democrats won both chambers of Congress on Nov. 3, and chip stocks sold off on fears of tighter AI rules and slower US data center construction. Cerebras lost 18% in a week.
At $94, the numbers look a lot better
Analysts have built their estimates on management’s plan:
Consensus has $890 million of revenue this year, in line with the top of management’s core revenue outlook. After that it has $2.96 billion in 2027 and $7.56 billion in 2028. So analysts are counting on management to deliver its plan, and Thursday’s report is the first check on it since the sell-off.
Cerebras has no earnings to price, so it trades on forward sales, and it’s near the cheap end of its short history:
At 15x, it’s well under its 35x average since listing and close to its 13x low of Nov. 5.
The analysts’ consensus target has barely moved:
The consensus target is $266, down from $294 when the stock listed. Even the lowest of the 11 analysts’ targets, $170, is well above the stock’s $93.66. I’d trust the multiple more than the targets, though: they’ve hardly budged while the stock lost more than two-thirds of its value.
The funds’ bigger chip holdings look cheap too, and far less rides on one report for them. NVIDIA trades at about 14x forward earnings, well under its 24x average of the past year, and reports on Nov. 17. Dragoneer is the exception on NVIDIA: its filing shows none at June 30, after 3.73 million shares a quarter earlier. Taiwan Semiconductor trades at about 19x, close to its five-year average of 18x, and its October revenue rose 59.7% from a year earlier. Broadcom, also at about 19x, is below its five-year average of 24x ahead of its report in early December.
A buy, in a small dose
The risk is concentration. A single multi-year OpenAI deal, for 750 megawatts and valued at more than $20 billion, makes up much of that backlog. And Cerebras still posts operating losses.
Still, I think Cerebras is a buy before Thursday’s report, as a small position. At 15x forward sales, investors are already pricing in a lot going wrong, and the company has more revenue under contract than the market says it’s worth. For a core holding, I’d rather own NVIDIA at 14x earnings, as Altimeter did in size at June 30.
Of course, management has to stand by its 2027 plan on Thursday’s call. And the funds’ 13Fs for the quarter ended Sept. 30, due by Nov. 16, will show which of them held on through the slide.
So what is Cerebras stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
