CoreWeave shares fell about 15.5% on October 14 as its bond yields approached 15%, CNBC reported, with the 2032 bond later reaching about 15.8%. Credit default swap spreads rose above 1,140 basis points at one point, a level generally viewed as distressed. The company has taken on more than $51 billion of debt and obligations to fund its buildout, and S&P rates it B+.
CNBC said the move was fueled partly by social media, after investor Chamath Palihapitiya posted a chart of the bond yield and Elon Musk replied "yikes." CEO Mike Intrator called the moves irrational and said the backlog more than supports its debt obligations. Wells Fargo's Luis Alvarado said investors are demanding more risk compensation, while Paul Meeks of Freedom Capital Markets said the concern is overdone.
Source: CNBC