Cathie Wood's ARK Buys CoreWeave. The Case for Buying Now. -- Barrons.com

By Kit Norton

There is at least one investor who isn't afraid to be buying CoreWeave stock, and that is Cathie Wood.

Shares of CoreWeave, which provides computing power for artificial intelligence, sank more than 15% on Wednesday and were down 7.7% at $60.74 on Thursday. Even as CoreWeave stock kept retreating below key technical levels, Wood's ARK Invest funds weren't scared off.

A trading notice Wednesday revealed that Wood, a prominent tech bull, added 188,665 shares across the ARK Innovation ETF and the ARK Next Generation Internet ETF. Wood tends to acquire shares of companies when they have dropped below key moving averages.

The ARK Innovation ETF has posted a gain 6.2% on the year including Thursday trading. The ETF was, however, has fallen 5.8% over the past 12 months. The ARK Next Generation Internet ETF has risen 5.6% this year but has declined 8.7% over the past 12 months.

The case for buying CoreWeave stock, however, seems precarious at best right now. Fears around debt and capital have clouded the AI trade, and a selloff in CoreWeave's corporate bonds Wednesday signaled credit investor concerns about the firm's mounting debt and future borrowing costs. Shareholders were spooked by the yield on CoreWeave's 9.625% notes, due in 2032, touching 15% on Wednesday.

CoreWeave said Wednesday that its revenue backlog should more than support the payment for all of its debt obligations, without needing customers to renew their contracts or finding new tenants for the properties. Still, the sharp price decline was hardly a great sign for CoreWeave stock, which has generally been viewed as a proxy for risks associated with the broader AI trade.

Wood wasn't alone in seeing an opportunity in CoreWeave stock as it started trading at its lowest price since July. Deutsche Bank analyst Brad Zelnick noted Thursday that the "dislocation" could present a buying opportunity for investors.

"A strong customer base, established record of execution, backlog conversion and leading infrastructure performance is all supportive of their issuer profile relative to neocloud peers," Zelnick said in a research note.

He added that the vast majority of CoreWeave's backlog is associated with long-term take or pay contracts where contracted revenue fully covers all capital and operating costs associated with the contract and generates a return for the company.

The most compelling case for investors to acquire CoreWeave could be a bet that Nvidia will come to its rescue. Nvidia and CoreWeave already have a close relationship, with the former acting as supplier, customer, and investor in the latter.

"Nvidia needs to step up with financing backstops for CoreWeave and the broader neocloud ecosystem," Michael Haber, senior vice president of High Yield Strategy at Jefferies, said in a research note Wednesday.

But with many AI-related stocks getting hit hard, caution is the name of the game. CoreWeave is no exception.

The stock was 30% below its 200-day moving average at the closing bell on Wednesday and down 25% from its 50-day moving average. If the stock closes below its July 29 closing price of $60.82, it will be a fresh 52-week low.

Many are proceeding with caution -- just not Cathie Wood.

Write to Kit Norton at kit.norton@barrons.com

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October 15, 2026 10:12 ET (14:12 GMT)