TLDR
- Cerebras Systems (CBRS) stock jumped over 7% Tuesday, trading near $211.
- The rally follows a new partnership with Gimlet Labs to deploy AI inference hardware.
- The stock is testing a key $219 pivot level inside a range it has held since late July.
- Wall Street rates CBRS a “Moderate Buy” with an average price target near $300.
- Insiders, including the CEO and CTO, have sold large stock blocks in recent weeks.
Cerebras Systems (CBRS) stock climbed 7% on Tuesday, trading near $211 after touching an intraday high above $210. The move builds on a rally that started Monday and pushes the stock back toward a price zone it has tested several times since late July.
The gain follows news that Cerebras will supply its wafer-scale computing systems to Gimlet Labs, a cloud computing startup. The deal targets ultrafast AI inference speeds of up to 3,000 tokens per second.
Cerebras Stock Hits Key Technical Level
Cerebras stock has spent two months bouncing between a floor near $167 and a ceiling around $260. That floor has held on three separate tests since late July.
The ceiling has rejected two attempts to break higher, both reversing within a day or two. Right in the middle of that range sits $219, a level the stock has bounced off before.
Cerebras stock is now trading above both its 20-day and 50-day moving averages. That’s a sign the current push has some trend support behind it, rather than being a one-day spike.
If the stock clears $219, the path toward retesting the $260 ceiling opens up. Given how fast CBRS has moved in past weeks, that retest could come quickly.
But the stock’s own history suggests caution. Both prior visits to $260 ended in sharp pullbacks rather than sustained gains.
The Gimlet Labs Deal
Gimlet Labs will combine its inference cloud with Cerebras‘ hardware. The companies expect the first data center deployment before the end of the year.
The deal reportedly includes a potential 100-megawatt customer commitment. That would mark a shift for Cerebras beyond its traditional focus on AI model training work.
Wall Street’s take on Cerebras remains largely positive. The stock carries a “Moderate Buy” consensus rating and an average price target of $299.90.
Craig Hallum and TD Cowen both started coverage with buy ratings in June, at $325 and $275 price targets. Citigroup trimmed its target from $340 to $320 in August but kept its buy rating.
Not everything has gone smoothly for the company. Cerebras posted a quarterly loss of $2.98 per share in August, far wider than the $0.21 loss analysts expected.
Revenue for the quarter came in at $209.87 million, up 74% from a year earlier. The stock fell after that report despite the strong revenue growth.
Insider selling has also drawn attention. CEO Andrew Feldman sold 237,559 shares in August at an average price of $199.27, a transaction worth over $47 million.
CTO Sean Lie sold 120,000 shares for roughly $25.1 million under a pre-arranged trading plan. COO Dhiraj Mallick sold shares worth $8.6 million the same month.
In total, insiders sold more than 1.4 million shares last quarter, worth close to $300 million. Several hedge funds still built new positions in Cerebras during the second quarter, including Silicon Valley Capital Partners and IFP Advisors.
Cerebras stock’s 50-day moving average sits at $203.85. The company holds a low debt-to-equity ratio of 0.02, alongside a current ratio of 5.82.
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