- CRWV shares fell 27.5% from the prior Friday close to 52-week lows, then rebounded 17%, and fell another 5% on the day of the article.
- Five-year CDS on CoreWeave widened from 452 bps in early June to over 1100 bps, implying roughly a 60% probability of default within five years.
- CoreWeave carries $51.6 billion in debt against zero historical profitability, and the June 2032 8.5% bonds issued at par fell nearly 18% through the prior Friday.
- The company faces an estimated $16.45 billion in negative free cash flow in H2 2026 and another $30.6 billion in FY27.
- Sell-side views are split: HSBC rates CRWV Sell with a $39 target, while BNP and Cantor Fitzgerald see the stock more than doubling.
- Earnings are a few weeks away, with 15.4% short interest and leverage above 2:1 amplifying equity moves.
- The article recommends a November 80/January 72.5 call diagonal, trading just under $6 per spread, as a way to avoid outright directional risk into earnings.
Quotes
“Because CRWV is levered by more than 2:1, a 10% move in enterprise value translates to a nearly 22% swing in equity value.”