CoreWeave Inc (NASDAQ:CRWV) shares are trading lower Monday after the company announced a proposed offering of convertible senior notes.
What Happened: CoreWeave said it intends to offer $2 billion of convertible senior notes due 2031 in a private offering to institutional investors. The cloud AI company expects to grant the initial purchasers a 13-day window to purchase up to an additional $300 million of the notes.
The notes will be guaranteed by CoreWeave’s wholly owned subsidiaries and will accrue interest payable in cash semi-annually, with a maturity date of Dec. 1, 2031, unless earlier repurchased, redeemed or converted.
CoreWeave intends to use the net proceeds to fund the cost of entering into the capped call transactions, as well as for general corporate purposes.
CoreWeave had approximately $1.89 billion in total cash and cash equivalents as of Sept. 30. The company also entered into an agreement last month to increase its revolving credit facility from $1.5 billion to $2.5 billion and extend the maturity date from May 2028 to November 2029.
CRWV Analysis: CoreWeave is currently showing a mixed technical picture, with the stock trading 5.8% above its 20-day simple moving average (SMA) but struggling significantly below its 50-day and 100-day SMAs, which are 23.4% and 23.6% above the current stock price, respectively. This setup suggests that while there might be medium-term strength, the longer-term trend is under pressure, indicating potential challenges ahead for traders.
The RSI is currently at 47.87, which is considered neutral, suggesting that the stock isn’t in overbought or oversold territory right now. This level indicates that momentum is neither strongly bullish nor bearish, so traders should watch for any shifts that could signal a change in trend.
Currently, there are no defined support or resistance levels, which makes it harder to gauge potential price action. Traders should be cautious, as the absence of these levels means that price movements could be more volatile and unpredictable.
Looking at the 12-month performance, CRWV has gained 120.75%, which reflects a strong longer-term trend despite the recent pullback. This impressive return shows that there has been significant interest in the stock over the past year, but the current technical setup suggests that traders should proceed with caution.
CRWV Price Action: CoreWeave shares were down 4.93% at $83.95 at the time of publication on Monday, according to Benzinga Pro.
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