Cerebras (CBRS) Rebounds as Analyst Dismisses OpenAI-Nvidia Concerns as Exaggerated

TLDR

• Freedom Capital shifted its stance on Cerebras Systems (CBRS) to Buy from Hold, establishing a $209 price objective.
• The rating change arrives after a steep 17% decline sparked by reports of OpenAI utilizing Nvidia GPUs for an accelerated GPT model variant.
• Paul Meeks, the analyst behind the upgrade, characterized the market’s response as “exaggerated” and downplayed the OpenAI situation as a minimal risk.
• The stock advanced approximately 2% following the announcement, bouncing back somewhat after approaching its post-public debut lows.
• Analysts on Wall Street anticipate Cerebras revenue will surge past $2.95 billion by 2027, representing more than triple current levels.

Cerebras Systems (CBRS) shares gained close to 2% on Friday following a ratings upgrade from Freedom Capital, which elevated the AI chip manufacturer to Buy from Hold. The timing follows a sharp 17% decline earlier this week driven by uncertainty surrounding its OpenAI partnership.

Cerebras Systems Inc., CBRS

Paul Meeks, the analyst responsible for the upgrade, established a $209 price objective for the shares. While that figure sits below the consensus Street estimate of $292, it represents a notable change in sentiment from Freedom Capital, which had maintained a Hold stance since prior to the company’s initial public offering.

The recent downturn was ignited by news that OpenAI has been deploying Nvidia GPUs to support a higher-speed iteration of its GPT architecture. Market participants interpreted this development as evidence that OpenAI may be reducing its dependence on Cerebras technology moving forward.

Meeks challenged that interpretation. He argued that the stock’s decline was “exaggerated” and characterized the potential OpenAI risk as modest, even if the reporting proves entirely accurate.

What’s Driving the Bullish View

Meeks highlighted robust demand dynamics in the AI inference market, noting that capacity constraints are likely to persist for the foreseeable future. He maintains confidence that Cerebras will continue securing agreements with strategic partners including AMD and Amazon Web Services, irrespective of OpenAI’s hardware decisions involving Nvidia.

Central to his investment thesis is Cerebras’ proprietary Wafer Scale Engine architecture. The technology is purpose-built for efficient AI inference workloads, which Meeks views as a competitive edge as the industry pivots from training models to deploying them at scale.

He also outlined a scenario where GPU technology handles the prefill phase of processing requests, while Cerebras hardware manages the decode stage for faster throughput. Such a complementary architecture could ensure Cerebras maintains relevance even in environments dominated by GPU infrastructure.

Revenue Projections and Execution Risk

Current consensus estimates call for Cerebras to generate approximately $887 million in revenue this year, escalating to $2.95 billion by 2027. That trajectory represents a more than threefold expansion over a two-year period.

Analysts tracking the company emphasize that achieving these targets hinges on operational execution. The critical factors include successfully scaling power infrastructure and manufacturing capabilities according to plan and within budget constraints.

At the time of Freedom Capital’s upgrade, shares were changing hands at $172.50. That price point hovers just above the stock’s post-IPO floor of $169, which was established back in May 2026.

Freedom Capital’s $209 target stands as the most cautious projection among Wall Street firms covering the stock. The firm acknowledges having been impressed by the Wafer Scale Engine technology since before the public offering, but deliberately waited for a more attractive valuation before issuing a Buy recommendation.

That patience has now ended with the recent pullback. Freedom Capital positions the current price level as an opportune moment for investors with longer time horizons who can overlook near-term volatility related to the OpenAI speculation.

Cerebras shares remain substantially above their post-IPO nadir but continue to reflect the impact of this week’s selling pressure. The coming quarters will reveal whether the company’s pipeline with AMD and AWS expands at the rate analysts are projecting.