Breakfast News: CoreWeave Set To Go Public
March 28, 2025
|
Thursday's Markets |
|---|
| S&P 500 5,693 (-0.33%) |
| Nasdaq 17,804 (-0.53%) |
| Dow 42,300 (-0.37%) |
| Bitcoin $87,129 (-0.12%) |
1. CoreWeave Listing Offers AI Bellwether
CoreWeave is set to begin trading today on the Nasdaq under the ticker CRW. After years of a slow IPO market in general, the public launch of the first pure-play AI company is noteworthy, and may be followed by many other tech firms coming to market soon.
- Backing from the big brother: Nvidia (NVDA +1.08%) is anchoring the share sale in its role as an existing investor. CoreWeave was one of the early adopters of Nvidia's graphics chips for data centers.
- $40 price level below the anticipated $47-$55 range: More than 75% of 2024 revenue was generated by just two customers, one being Microsoft (MSFT +1.05%). This is one potential concern for new investors, alongside the scrutiny that will come on the AI sector in general, which may be expressed by how well CoreWeave stock trades in its early days.
2. Top Foolish Movers
Stock Advisor rec Lululemon (LULU +2.63%) slid 10% after the market closed following a disappointing outlook as part of the latest results, with concerns around consumer spending in the U.S.
- Gross profit margin likely to drop 0.6% this year versus 2024: CFO Meghan Frank told investors the fall was in part due to the impact of increased tariffs to China and Mexico. Any expansion of tariffs would lead Frank to look to potentially change pricing and further analyze costs.
- "Fiscal 2025 was a milestone year": Braze (BRZE 0.39%) rocketed over 12% higher in after-hours trading after posting quarterly earnings well above analyst expectations. The CEO spoke of three straight quarters of profitability, with a strong outlook for the coming year.
3. Roku Gains Support
Bank of America (BAC +1.29%) analyst Brent Navon placed a new Buy rating on Rule Breakers recommendation Roku (ROKU +3.17%), as it cashes in on higher user streaming engagement versus traditional TV. The stock has bucked the broader trend so far in 2025, up 2.3% versus the 3.2% fall in the S&P 500.
- "Poised to enter the next phase of monetization": Navon pointed to the rapidly growing user base with 90 million active accounts in 2024 from which it can look to drive revenue and profitability growth by targeting paid services.
- Ranked 19th for its ability to beat the market over the next 5 years across all TMF recommendations: Around 50% of the analysts polled on FactSet have a Buy rating currently, versus only 33% of Buys at this time last year.
4. Robinhood Pushes Into Banking
Robinhood (HOOD +4.82%) revealed new products including a traditional savings account as it showcased a new push to move beyond trading and go after the big banks.
- "We see a gap in the market for the high end": Co-founder Vlad Tenev wants to make the company a one-stop destination for people to manage their wealth, with a particular focus on the wealthy and their stock portfolios.
- Up 118% in the past year versus 8.7% for the Nasdaq: The company has been working hard to differentiate from the hyper-competitive trading space. Last year it launched events-based contracts and has recently debuted a prediction markets hub.
5. Next Up: Eyes Turn to Impending Data
The Federal Reserve's preferred inflation measure, core Personal Consumption Expenditures (PCE), is forecasted to rise from 2.6% in January to 2.7%.
- Monitoring for signs of a trend: The data will be watched closely following the surprise drop in Consumer Price Index (CPI) inflation earlier this month down to 2.8%.
- Insights into consumer confidence and expectations: The Michigan consumer sentiment index for March is due, expected to stay the same as last month at 57.9.
6. Foolish Fun
Did you know... If you missed the market's 10 best days over the past 30 years, your returns would have been cut in half.
