Does Wall Street Rate Wolfspeed Inc. (WOLF) Shares A Buy?

As of Friday close, Wolfspeed Inc.’s (NYSE:WOLF) stock was up $7.61, moving up 10.80 percent to $78.07. The average number of shares traded per day over the past five days has been 2,727,860 shares. 1 time new highs have been achieved over the past 5 days, with a -$2.81 fall in that time frame. In the last twenty days, the average volume was 2,070,190, while in the previous 50 days, it was 1,883,674.

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Since last month, WOLF stock retreated -31.91%. Shares of the company fell to $63.44 on 05/12/22, the lowest level in the past month. A 52-week high of $142.33 was reached on 01/04/22 after having rallying from a 52-week low of $63.44. Since the beginning of this year, WOLF’s stock price has dropped by -30.15% or -$33.70, and marked a new high 2 times. However, the stock has declined by -45.15% since its 52-week high.

Wolfspeed Inc. (WOLF) last reported insider trading activity 2 days ago on May 12. LOWE GREGG A, the PRESIDENT & CEO of the company, purchased of 4,000 shares for $64.11 on May 12. It resulted in a $256,422 investment by the insider. LE DUY LOAN T added 1,000 shares at an average price of $100.04 on Feb 10. The insider now owns 21,540 shares following the transaction.

Valuation Metrics

The stock’s beta is 1.61. Besides these, the trailing price-to-sales (P/S) ratio of 15.55, the price-to-book (PB) ratio of 4.04.

Financial Health

In the three months ended September 29, Wolfspeed Inc.’s quick ratio stood at 5.00, while its current ratio was 5.70, showing that the company is able to pay off its debt. According to company report, the long-term debt-to-equity ratio for the quarter ending September 29 was 0.43, and the total debt-to-equity ratio was 0.43. On the profitability front, the trailing twelve-month gross margin is 32.30% percent. In the year ended September 29, EBITDA margin amounted to -17.35%, whereas operating margins totaled -52.70%. Based on annual data, WOLF earned $164.6 million in gross profit and brought in $525.6 million in revenue.

A company’s management is another factor that investors consider when determining the profitability of an investment. In the past year, return on investment (ROI) was -10.70%. Return on equity (ROE) for the past 12 months was -17.10%.

According to the earnings report, the company had a higher net income in the recent quarter than it did in the previous quarter. WOLF’s revenue rose 56.29% to $173.1 million during the quarter, while net income inched up to $188.0 million. While analysts expected Wolfspeed Inc. to report -$0.23 quarterly earnings, the actual figure was -$0.21 per share, beating the consensus estimate by 8.70%. During the quarter, the company generated -$22.6 million in EBITDA. The liabilities of Wolfspeed Inc. were 838.0 million at the end of its most recent quarter ended September 29, and its total debt was $866.0 million. The value of shareholders’ equity is $123.58 million.

Technical Picture

This quick technical analysis looks at Wolfspeed Inc.’s (WOLF) price momentum. With a historical volatility rate of 138.98%, the RSI 9-day stood at 40.62% on 13 May.

With respect to its five-day moving average, the current Wolfspeed Inc. price is down by -3.47% percent or -$2.81. At present, WOLF shares trade -31.29% below its 20-day simple moving average and -25.29% percent below its 100-day simple moving average. However, the stock is currently trading approximately -21.38% below its SMA50 and -14.29% below its SMA200.

Stochastic coefficient K was 17.42% and Stochastic coefficient D was 9.17%, while ATR was 7.34. Given the Stochastic reading of 35.37% for the 14-day period, the RSI (14) reading has been calculated as 39.67%. As of today, the MACD Oscillator reading stands at -8.51, while the 14-day reading stands at -13.58.

Analyst Ratings

SMBC Nikko launched its rating on Wolfspeed Inc. (NYSE: WOLF) to an Outperform in a note to investors on March 29, 2022. Wolfspeed Inc. (WOLF) has been rated Overweight by analysts. According to 1 brokerage firm, WOLF is a sell, and 6 firms recommend it is a Hold. There are 1 analyst who say the stock is underweight. A total of 0 analysts rate Wolfspeed Inc. stock as buy, with 8 recommending it as overweight.

With a median target price of $125.00, the current consensus forecast for the stock is $70.00 – $150.00. Based on these forecasts, analysts predict Wolfspeed Inc. (WOLF) will achieve an average price target of $118.64.


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