Wolfspeed
WOLF
$29.27
-7.75%
Wolfspeed develops and manufactures silicon carbide (SiC) semiconductor technologies for power electronics applications, serving industries such as electric vehicles, renewable energy, and industrial systems. As a leading pure-play SiC company, it holds a distinct competitive position in the transition from traditional silicon to wide-bandgap semiconductors. The current investor narrative centers on a strategic pivot from the struggling EV market toward high-margin defense and industrial applications, highlighted by a partnership with GE Aerospace, while the stock has experienced extreme volatility amid ongoing operational losses and a recent bankruptcy filing.…
WOLF
Wolfspeed
$29.27
Related headlines
WOLF 12-Month Price Forecast
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Wolfspeed's 12-month outlook, with a consensus price target around $30.00 and implied upside of +2.5% versus the current price.
Average Target
$30.00
0 analysts
Implied Upside
+2.5%
vs. current price
Analyst Count
—
covering this stock
Price Range
$30 - $30
Analyst target range
Only one analyst covers WOLF, with a target price of $40.00, implying 33.8% upside from the current price of $29.89. The consensus recommendation is not provided, but the single target suggests a neutral-to-bullish stance. The limited coverage indicates that WOLF is a small-cap, high-risk name with limited institutional interest, leading to less efficient price discovery and higher volatility. The target range is narrow at $40.00 low to $40.00 high, reflecting low conviction due to the single estimate. The high target of $40 assumes a successful pivot to defense and industrial markets, while the low target of $40 (same) implies no downside scenario is priced. Recent institutional ratings show mixed sentiment: Piper Sandler maintains Overweight, while Susquehanna is Neutral, and JP Morgan and Citigroup have downgraded to Underweight/Sell. This divergence underscores the uncertainty around the stock's future, and the wide range of opinions suggests high risk.
Bulls vs Bears: WOLF Investment Factors
Wolfspeed presents a high-risk, high-reward profile. The bull case rests on a successful pivot to defense and industrial markets, a deeply discounted valuation, and potential for multiple expansion. However, the bear case is formidable: negative gross margins, declining revenue, massive cash burn, negative equity, and a recent bankruptcy filing. The bear side currently has stronger evidence, as the company's financials are deteriorating and the path to profitability is uncertain. The single most important tension is whether the defense/industrial pivot can generate enough revenue and margin improvement to offset the EV market decline and cash burn before the company runs out of funding.
Bullish
- Strategic Pivot to Defense & Industrial: Wolfspeed's partnership with GE Aerospace targets high-margin defense and industrial markets, reducing reliance on the struggling EV sector. This pivot could unlock new revenue streams with better profitability, as defense contracts typically offer higher margins and longer-term visibility.
- Deep Discount to Industry PS Ratio: The trailing PS ratio of 1.38x is well below the semiconductor industry average of 3-5x, implying a 54-72% discount. If the company stabilizes and returns to growth, multiple expansion could provide significant upside.
- Single Analyst Target Implies 33.8% Upside: The lone analyst covering WOLF has a $40 target, representing 33.8% upside from the current $29.89. While coverage is thin, the target suggests the stock is undervalued relative to potential turnaround success.
- Massive 1-Year Price Surge of 2050%: Despite recent pullback, the stock has gained 2050% over the past year, indicating strong momentum and speculative interest. This could attract further buying if the pivot narrative gains traction.
Bearish
- Negative Gross Margin of -26.6%: Gross margin is -26.6%, meaning production costs exceed revenue by a wide margin. This structural unprofitability is unsustainable and indicates severe operational inefficiencies that must be resolved before any recovery.
- Declining Revenue and Cash Burn: Revenue fell 19% YoY to $150.2M, and free cash flow was -$121.6M in the latest quarter, with TTM FCF of -$750.3M. The company is burning cash rapidly, requiring external financing and risking dilution or bankruptcy.
- Negative Equity and Extreme Leverage: Debt-to-equity is -14.64 due to negative equity, and the current ratio is 0.36, indicating severe liquidity risk. The company may struggle to meet near-term obligations without additional capital.
- Recent Bankruptcy Filing and Institutional Downgrades: A recent bankruptcy filing and downgrades from JP Morgan and Citigroup to Underweight/Sell highlight extreme financial distress. This overhangs the stock and could lead to further downside.
WOLF Technical Analysis
WOLF exhibits a dramatic recovery trend over the past year, with a 1-year price change of +2050.4%, though the stock has pulled back sharply from its 52-week high of $80.82 to the current price of $29.89, which sits at 30.1% of the 52-week range. This positioning near the low end of the range suggests the stock is in a corrective phase after an explosive rally, potentially offering a value entry if the uptrend resumes, but also signaling risk of further downside if selling pressure persists. Short-term momentum is decisively bearish, with a 1-month price change of -38.6% and a 3-month change of +16.9%, indicating that the recent pullback has accelerated sharply and diverges from the longer-term uptrend. The 1-month decline of 38.6% versus the 1-year gain of 2050% suggests a potential trend reversal or a deep correction within a secular bull market, warranting caution. The 52-week high of $80.82 acts as key resistance, while the 52-week low of $8.05 provides support; a breakdown below recent lows near $29 could signal further downside, while a move above $40 would indicate stabilization. With a beta not provided, the stock's extreme volatility—evidenced by a max drawdown of -70.5%—implies risk far exceeding the broader market, requiring strict position sizing.
Beta
—
—
Max Drawdown
-68.1%
Largest decline past year
52-Week Range
$8-$81
Price range past year
Annual Return
+1961.3%
Cumulative gain past year
| Period | WOLF Return | S&P 500 |
|---|---|---|
| 1m | -44.7% | +0.4% |
| 3m | +6.2% | +5.5% |
| 6m | +63.0% | +8.4% |
| 1y | +1961.3% | +18.9% |
| ytd | +54.6% | +9.6% |
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WOLF Fundamental Analysis
Revenue is in a declining trajectory, with the most recent quarterly revenue of $150.2 million representing a year-over-year decline of -19.0%, following a pattern of sequential decreases from $196.8M in Q1 FY2026 and $168.5M in Q2. The revenue breakdown shows Power Products contributing $100.1M (66.7%) and Materials Products $50.1M (33.3%), with both segments likely under pressure from weak EV demand. This revenue contraction underscores the urgency of the company's pivot to defense and industrial markets, as the core EV market has softened. The company remains deeply unprofitable, with a net loss of -$119.9 million in the latest quarter and a gross margin of -26.6%, reflecting negative gross profit of -$40 million. While net losses have narrowed from -$643.6M in Q1 FY2026, the negative gross margin indicates that production costs exceed revenue, a severe structural issue. Operating margin stands at -69.4%, and net margin at -79.8%, far worse than industry norms for profitable semiconductor companies. The balance sheet shows a debt-to-equity ratio of -14.64 (negative equity), a current ratio of 0.36, and free cash flow of -$121.6 million in the latest quarter, with trailing twelve-month free cash flow of -$750.3 million. The company is burning cash rapidly, relying on external financing—evidenced by $96.9M in common stock issued in Q3—and has negative equity, indicating extreme financial risk. ROE of 359.9% is misleading due to negative equity, while ROA of -5.1% confirms asset inefficiency.
Quarterly Revenue
$150200000.0B
2026-03
Revenue YoY Growth
-19.0%
YoY Comparison
Gross Margin
-26.6%
Latest Quarter
Free Cash Flow
$-750300000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is WOLF Overvalued?
Since net income is negative, the price-to-sales (PS) ratio is the primary valuation metric; the trailing PS ratio is 1.38x, while forward PS (based on estimated revenue of $1.45B) is approximately 0.72x. The gap between trailing and forward PS implies the market expects significant revenue growth, but given the recent revenue decline, this optimism may be overdone. Compared to the semiconductor industry average PS ratio of roughly 3-5x, WOLF's trailing PS of 1.38x appears deeply discounted, trading at a 54-72% discount. This discount is justified by the company's negative gross margins, declining revenue, and bankruptcy risk, though it could also reflect a potential turnaround if the defense pivot succeeds. Historical PS ratios have ranged from 4.0x to 6.4x over the past two years, with the current 1.38x near the bottom of that range. This suggests the market is pricing in significant distress, and any improvement in fundamentals could lead to multiple expansion, but the low multiple also reflects the high probability of equity dilution or restructuring.
PE
-0.6x
Latest Quarter
vs. Historical
N/A
5-Year PE Range 17x~59x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
-6.8x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Wolfspeed's financial health is precarious. The company has negative gross margins of -26.6%, meaning it loses money on every product sold. Revenue declined 19% YoY to $150.2M, and free cash flow was -$121.6M in the latest quarter, with TTM FCF of -$750.3M. The debt-to-equity ratio of -14.64 reflects negative equity, and the current ratio of 0.36 indicates the company cannot cover short-term liabilities with current assets. This cash burn rate, combined with a recent bankruptcy filing, suggests a high probability of equity dilution or restructuring.
Market & Competitive Risks: The stock is highly volatile, with a max drawdown of -70.5% and a 1-month decline of -38.6%. It trades at a PS ratio of 1.38x, which is a discount to the industry average of 3-5x, but this discount is justified by the company's distressed state. The pivot to defense and industrial markets faces competition from established players like Infineon and ON Semiconductor. Regulatory risks include potential export controls on SiC technology. The recent bankruptcy filing adds legal and reputational risk, potentially scaring off customers and partners.
Worst-Case Scenario: If the defense pivot fails to generate meaningful revenue and the company cannot secure additional financing, Wolfspeed could face liquidation or a forced sale at distressed prices. The realistic downside is to the 52-week low of $8.05, representing a -73% loss from the current price of $29.89. In a severe scenario, equity could be wiped out entirely, as the company has negative equity and mounting losses.