CoreWeave Earnings, Nvidia Fallout and Rate Hikes Back on the Table

NVIDIA

Across the shows: 99 speakers in other episodes, 79 bullish and 51 bearish calls, past 30 days

• Guy Adami · CNBCBearish

  Nvidia shares likely get worse before better; shareholder class actions likely if stock keeps falling.

  Adami argues that if the stock keeps falling, shareholder class action lawsuits are almost guaranteed. He says the company withheld material information about Huang's relationship with an alleged spy, and that the earlier company statement was contradicted. He concludes that Nvidia's situation gets worse before it gets better.

  “If the stock continues to go lower, I can almost guarantee, here come the class action lawsuits from shareholders. You withheld information, material information... So I guess my point is, I think it gets worse before it gets better.”at 11:51

• Tim Seymour · Seymour Asset ManagementBullish

  Nvidia is much cheaper; if Jensen Huang's exit happens, it would be a very interesting day to buy.

  Seymour thinks the stock gets cheaper before the event is resolved, since Huang's departure is still undecided. He argues the valuation is already very cheap and the worst-case scenario has largely happened. If Huang leaves, that would be a very interesting day to buy, though the stock would be lower.

  “I do think it gets cheaper. For sure. It is much cheaper. But that event that is cataclysmic for it, which is Jensen leaving, is still very much undecided right now... that would probably be a very interesting day to buy it if that happened.”at 12:33

• Karen Finerman · Metropolitan Capital AdvisorsUncertain

  Nvidia's CEO faces risk any other sector's CEO would; the board must prove its independence.

  Finerman compares the Nvidia situation to Rex Tillerson's oil dealings with Russia or China: any other CEO in any other sector would be gone. She says investors have been weighing this for some time. She also notes Nvidia has no executive chairman and several board members who must show independence, and that the CEO's risk is being underweighted.

  “data is the new oil, right? So if this was Rex Tillerson twenty five years ago and it was about oil with Russia or China, would Rex keep his job? And I think any other CEO in any other sector right now would be gone.”at 13:57

• Katie Stockton · Fairlead StrategiesUncertain

  Nvidia's long-term support is broken, but the short-term downdraft looks overdone with a buy signal.

  Long-term support is broken at current levels, and Nvidia would need to reclaim about 186 by the end of next week to avoid confirming that breakdown. In the short term, a DeMark buy signal is expected tomorrow, the first since June 2019. The short-term downdraft, especially the gaps down, looks overdone as support from recent lows around $164 (transcript reads $1.64) comes in.

  “The bad news is that long term support is broken at current levels. It would need to reclaim about 186 by the end of next week to avoid confirmation of that breakdown.”at 14:49

• Mandy Xu · Cboe Global MarketsBearish

  Retail put buying in Nvidia runs about 10 points above its YTD average; bullish call buying is fading.

  Put buying in large-cap tech, especially Nvidia, is running about 10 percentage points above its year-to-date average from retail traders, with a lesser degree of call buying. Option traders are largely agreeing that things could get worse before they get better, a sign of hedging demand and worry about further downside.

  “For example, in Nvidia, put buying activities running about 10 percentage point higher than the year to date average from retail traders. And then we're also seeing a lesser degree of call buy.”at 18:20

• Dan Ives · Yorkville Ives & Co.Bearish

  Nvidia could fall another 25-30% if Jensen Huang stops being CEO; odds of removal are rising.

  Ives estimates street-assigned odds of Huang being removed at about 15%, possibly 20%. A board investigation over the next four to six weeks is the key overhang. If the odds rise, the stock keeps falling. If Huang stays on, the worst is probably behind Nvidia.

  “I view it like this. If you think Jensen is not going to be CEO of Nvidia, then the stock... In my opinion, the stock could be down another 25, 30% if Jensen's no longer CEO of Nvidia.”at 35:34

• Dan Ives · Yorkville Ives & Co.Uncertain

  Jensen Huang's leadership controversy is a key-man risk; the worst is behind only if he stays as CEO.

  Ives says the CEO controversy goes beyond a black eye for Nvidia and reaches analysts who covered Huang for years and rated him a gold-standard leader. He says the worst is probably behind if Huang gets past the matter and stays on as CEO. He flags that Nvidia has no clear succession plan, and that because Huang is central to Nvidia and the AI revolution, his departure would change the landscape for Nvidia and overall US tech. He treats leadership as key-man risk: a blessing on the way up, a curse on the way down.

  “And then I think if he gets past that and he stays on as CEO, okay, then the worst is probably behind. But I think that's the issue right now.”at 36:09

CoreWeave

Across the shows: 90 speakers in other episodes, 26 bullish and 97 bearish calls, past 30 days

• Guy Adami · CNBCBearish

  CoreWeave's debt load is the problem; the market doesn't believe its story and the bounce isn't robust.

  CoreWeave pays roughly a billion dollars a month in interest on its debt, and the market doesn't believe the growth story. Credit default swaps trade at levels that make the stock uncomfortable. A week earlier Nvidia might have been expected to backstop the stock, but Adami is no longer sure of that after recent events, so the post-earnings bounce is not robust.

  “The problem is, I think, a debt problem. They're staring at like a billion dollars a month sort of interest payments on their debt. And the market doesn't believe the story.”at 3:36

• Karen Finerman · Metropolitan Capital AdvisorsBullish

  Rising capex reinforces the story; 168% revenue growth and megawatt additions were fantastic; thesis is 2027+.

  Finerman says rising capex would normally scare people, but here it reinforces the story investors need to hear. Revenue grew 168% and the company added the megawatts it needed in the quarter. She argues the thesis has never been about the current quarter but about 2027 and beyond.

  “The numbers on the revenue side, 168%, were fantastic. They added the megawatts they needed to the quarter. This has never been about the here and now. It's really been about 27 and beyond.”at 5:08

• Katie Stockton · Fairlead StrategiesBearish

  CoreWeave's breakdown already hit a ~$40 measured-move objective; $40 is potential support, $65 now resistance.

  CoreWeave failed to break above its 200-day moving average in October and then broke support near $65, which is now potential resistance. That breakdown has already met a measured-move price objective of about $40, which Stockton identifies as potential support.

  “it failed to break out above its two hundred day moving average in October and proceeded to break support that was very important, around $65... the breakdown already met a measured move price objective of about $40.”at 5:28

• Guy Adami · CNBCUncertain

  Nvidia GPUs may hold value longer than expected, so CoreWeave's six-year depreciation schedule could be fine.

  Adami says Nvidia chips have held their value longer than he expected, so the six-year depreciation schedule may be fine. Others argue it should be six months, and if so that would change the math on CoreWeave a lot. He sees both forward-looking strengths and concerns in the company.

  “NVIDIA chips hold their value longer than a lot of people like myself probably thought. There are other people that think the six year should be six month. And if that were the case, it changes a lot of the math around this.”at 7:15

• Dan Ives · Yorkville Ives & Co.Bearish

  Neoclouds like CoreWeave are on the wrong side of the tech trend; debt overhang makes the space hard to own.

  Ives says the debt load limits CoreWeave's financing options and raises the question of whether it will slow its build-out. Microsoft rationalizing its neocloud deals makes the 132 billion dollar 'non-cancelable' backlog a semantic question, since hyperscalers can move to another neocloud. Converts are effectively off the table. A delayed-draw term loan at 7 to 7.5% would be a significant positive. Outside Nebius, he finds the group hard to own and prefers hyperscalers and semiconductor names.

  “Neo Clouds are on the wrong side of the trend. And I think that's why for them it continues to be sort of that, what I view of a challenging environment.”at 32:53

Nike

Across the shows: 13 speakers in other episodes, 8 bullish and 6 bearish calls, past 30 days

• Karen Finerman · Metropolitan Capital AdvisorsBullish

  Nike is the stock she'd buy: ~19x forward, not expensive, back near the $40 level.

  Nike traded back up to around $40, a level that was a six-month high, at about 19x forward earnings, which she calls not expensive. The earnings miss was mostly about the Q4 wholesale timing, so Q4 will be weaker. She worries about competition from On but says if she were buying one of these stocks, it would be Nike.

  “it traded right back up to that $40 level, which was a level that was kind of six month highs on a 19x forward, not expensive. But if Nike's pressured by competition... If I was gonna buy one of these stocks here, it would be Nike.”at 27:24

Anthropic

Across the shows: 110 speakers in other episodes, 150 bullish and 89 bearish calls, past 30 days

• Karen Finerman · Metropolitan Capital AdvisorsBearish

  Anthropic's IPO valuation looks stretched, ~50% above the May private mark set near the chip-index peak.

  The last private-market mark was $965 billion in May, a couple of weeks before the semiconductor index peaked before a 31% drawdown. Finerman accepts the ARR story, with annualized revenue around $88 billion through October and a path to a 10x multiple on about $150 billion next year. She still asks whether it makes sense to price the IPO about 50% above the peak of the market.

  “This was essentially a couple weeks before the SMH or the semiconductors index peaked before a 31% drawdown... should we really be pricing up 50% from where we were at the peak of the market? I don't know.”at 30:56

Oracle

Across the shows: 39 speakers in other episodes, 10 bullish and 37 bearish calls, past 30 days

• Dan Ives · Yorkville Ives & Co.Bearish

  Oracle's debt-funded AI buildout is a poster child for the overhang; the Street will eventually stop funding it.

  Ives says Oracle has to raise a large amount of capital to fund its backlog. Its debt is around 45 billion dollars, and he asks whether it goes to 50 or 55. Eventually the Street reaches a point where it says no more, and Oracle must look at alternative financing, just as CoreWeave does.

  “But the debt, that 45,000,000,000, does it go to 50, does it go to 55. And then the Street eventually gets to a no mas. You can't take on more.”at 34:55

SoftBank Group

Across the shows: 3 speakers in other episodes, 0 bullish and 4 bearish calls, past 30 days

• Guy Adami · CNBCBearish

  SoftBank's pullback from AI investment is the first of many; other firms will turn cautious on AI spending.

  Adami says SoftBank historically zigs when it should zag, and it has just posted a $7 billion quarterly loss. SoftBank has said it may pull back somewhat on its AI investment and has stepped away from talk of capex. Adami reads this as a sign that investors are growing more reluctant to put all their eggs in the AI basket, and he expects more companies to follow SoftBank's lead.

  “And they just came out and said, Hey, maybe we got to pull back a little bit on the AI invest. Forget about CapEx... I think SoftBank is the first of many.”at 38:37

SPDR S&P Capital Markets ETF

• Katie Stockton · Fairlead StrategiesBullish

  Capital markets ETF KCE is in a long-term uptrend with room for upside after a technical breakout.

  Stockton points to a long-term uptrend in KCE. The ETF recently recovered from a corrective phase into an oversold upturn and is not overbought, so it has room for upside follow-through toward its highs. A breakout above the 50-day moving average is a positive short-term catalyst. She also notes improved market breadth, with participation outside tech, and says the group may be less sensitive to interest rates than the broader financial sector.

  “Zooming out on a long term chart of KCE, you'll see a long term uptrend. Within that context, a corrective phase that gave way to an oversold upturn. And it's not overbought, right? So it has room for upside follow through.”at 40:50

Intercontinental Exchange

• Katie Stockton · Fairlead StrategiesBullish

  Intercontinental Exchange has broken out with very strong momentum and looks quite good technically.

  Stockton cites a technical breakout in Intercontinental Exchange and says its momentum is very strong. She presents this as one of the exchange names inside the KCE capital-markets group that look good.

  “the Intercontinental Exchange looks quite good. We have a breakout there, very strong momentum.”at 41:34

Ares Management

• Katie Stockton · Fairlead StrategiesBullish

  Ares shows a nice long-term turnaround underway within the asset manager group.

  Stockton cites Ares as one of the asset managers inside the KCE group and says its chart shows a nice long-term turnaround underway. The view rests only on the chart.

  “In addition to the asset managers, so Ares is one. You see a nice long term turnaround underway.”at 41:42

Blackstone

Across the shows: 4 speakers in other episodes, 2 bullish and 2 bearish calls, past 30 days

• Katie Stockton · Fairlead StrategiesBullish

  Blackstone has cleared its 50-day moving average, a positive short-term technical catalyst.

  Stockton says Blackstone has just moved through its 50-day moving average, which she calls a positive technical catalyst. She sees the asset-manager group as having a lot of room to run, with Blackstone as part of that.

  “Blackstone just got through its fifty day moving average as well, so some good positive technical catalysts.”at 41:48

Oil & fuels

• Guy Adami · CNBC

  Energy equities lag oil's 25% drop, so they look reasonably priced and may rise further.

  Oil is down about 25% from its October highs, but energy equities such as XLE have fallen only about 11% over the same period. There has not been a commensurate move in the stocks, so Adami judges them reasonably, if not cheaply, priced. He still thinks there is another leg higher for the equities than for the underlying commodity.

  “I still think there's another leg higher than the underlying commodity... the equities are still sort of reasonably, if not cheap price at these levels.”at 24:01

• Katie Stockton · Fairlead Strategies

  Crude oil shows downside exhaustion at $87 support; holding there preserves its higher-lows series.

  Short-term signs of downside exhaustion appear in crude, which is testing key support around $87 per barrel. The 200-day moving average is close by. If crude holds this area, the series of higher lows is preserved.

  “there are short term signs of downside exhaustion there. Crude oil prices are testing some key support around $87 per barrel. And if they can hold in this area, also the two hundred days pretty close to in line, I think that preserves the series of higher lows.”at 24:52

• Karen Finerman · Metropolitan Capital Advisors

  Midstream MLPs offer growth and yield with strong pricing; a good place to be in energy.

  Tim Seymour says he still believes in the energy trade for the long run and sees midstream MLPs as the trade within energy. Finerman expects MLP pricing to remain very strong. She says the MLPs have absorbed major inflationary costs from crude inputs, and that they offer both growth and yield, making them a barbell in one.

  “I think the pricing they now have is going to remain very strong. I think they've also had major inflationary costs attached to just the crude inputs. I think you want to be there. I think you have growth and yield and I think it's a barbell all in one.”at 25:26

US stock market outlook

• Mandy Xu · Cboe Global Markets

  Equity market is an AI rotation trade; volatility stays confined to tech with no broad contagion.

  Most equity volatility is focused on tech. Even after a rough week, five of the 11 sectors finished green, so there is no broad contagion. Xu says the market remains a rotation trade with AI either falling in or out of favor, and that rotation is what drives the market.

  “We haven't really seen broader contagion into the other sectors. Even last week, five out of the 11 sectors ended up in the green on the week. So I think that tells you the story in the equity market remains a rotation trade with AI either falling in or out of favor.”at 17:12

• Katie Stockton · Fairlead Strategies

  S&P 500 in short-term breakdown within cyclical uptrend; next relief rally likely struggles, so sell strength.

  The S&P 500 has a short-term breakdown within a cyclical uptrend. Seasonal strength and oversold readings suggest room for a bounce. Momentum behind the uptrend has been lost, however, so the next relief rally is likely to struggle to make new highs and the approach should be to sell strength.

  “we have a short term breakdown within the context of cyclical uptrend... there is enough of a loss of long term momentum behind the uptrend to suggest that perhaps this next bounce or relief rally does struggle to make new highs. So more in the mindset perhaps of selling strength.”at 21:22

US Treasuries & yields

• Mandy Xu · Cboe Global Markets

  Bond options show traders positioning for lower yields; inflation is not seen as persistent.

  The reaction in bonds is not panic. Option positioning shows more bullish than bearish activity in bonds, with demand for calls, so people are positioning for yields to go lower. Xu believes this reflects jitters in the AI-driven equity trade rather than worry that inflation will be persistent. The concern is the broader macro picture, and any weakness there could push yields lower.

  “But even there, I would say it's not panic... if you look at the option market positioning, we're still actually seeing more bullish activity in bonds than bearish. So more demand for calls. So people actually positioning for yields to go lower.”at 19:28

Market sentiment, positioning & volatility

• Mandy Xu · Cboe Global Markets

  Index correlations near 20% versus a typical 70% signal an isolated tech selloff; higher correlations could lift VIX.

  Correlation typically sits around 70% during sharp selloffs, when stocks sell off together and investors buy macro index protection. Last week's big selloff saw correlation in the 20s, so the move looks isolated to tech. Xu says if correlations reprice higher, which amplifies VIX moves, the selloff could spread. Melissa Lee's follow-up suggested the VIX could push into the 30s or 40s.

  “typically correlation level around 70%. Last week on that big sell off correlation levels in the 20s.”at 20:45

Banks

• Karen Finerman · Metropolitan Capital Advisors

  European money center banks should do really well; banks have a great setup after a difficult run.

  Finerman says banks overall have had a very good run after a very difficult one, which created a great setup for owning them. She singles out European money center banks as likely to do well. Her reasons are a weaker dollar, which supports the international trade she ties to the post-midterm period, and possibly less regulation in Europe. Her fund owns three or four of Santander, Barclays and HSBC.

  “it actually created a great setup for owning them. I also think European banks, money center banks, do really well here.”at 42:09