Cramer's "Only Trust" Pick CoreWeave Crashes 15% Hours After Endorsement 😬

CoreWeave (CRWV) stock fell nearly 15% on Wednesday, less than a day after CNBC host Jim Cramer told viewers it was the only neocloud company he trusts, sending traders to revive the long-running "Inverse Cramer" meme. Shares were trading at $65.93, down more than 15% over 24 hours, according to Yahoo Finance data. "If you want to be in that business of the neocloud, the only one that I trust and want to be in is CoreWeave," Cramer said on the Tuesday Mad Money Lightning Round, directing a caller away from rival IREN.

The slide followed a sell-off in CoreWeave's bonds that pushed yields sharply higher. On Tuesday, investor Chamath Palihapitiya posted a chart showing yields on $1.25 billion of CoreWeave bonds due 2032 touched 15% before closing at a record 14.5%. That marks a jump from the 9.625% coupon at issuance in June. Commenting on Palihapitiya's post asking whether the AI build-out was creating a private credit bubble, Elon Musk replied, "Yikes." Higher yields indicate lenders are demanding more compensation to hold CoreWeave's debt. CoreWeave rents Nvidia chips to artificial intelligence developers, and its total debt reached about $52 billion by June, exceeding its roughly $37 billion stock market value.

CoreWeave's interest expense climbed to $640 million in the April-to-June quarter, up from $267 million a year earlier, and the company reported a net loss of $626 million on revenue that more than doubled to $2.58 billion. Co-founder Brannin McBee told the Financial Times that its chip-backed loans are not "scary debt." D.A. Davidson analyst Gil Luria has warned that the equity could be worth zero if AI spending reverses. Wall Street remains largely bullish, with up to 20 of 27 analysts tracked by TipRanks rating CRWV a Buy and an average price target of $143.96, though even the lowest Street target sits at $74.

The selling extended across AI-linked names. Nebius (NBIS) fell about 10%, Oracle dropped 7%, IREN and Hut 8 (HUT) each declined around 9%, and TeraWulf (WULF), WhiteFiber (WYFI) and Cipher Mining (CIFR) lost roughly 8% in the same session, according to data cited by trader Shay Boloor. The declines came as investors weighed the cost of financing the AI build-out and tested the durability of the neocloud business model.