Wolfspeed (WOLF) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
·3-min read

Wolfspeed (WOLF) closed at $116.97 in the latest trading session, marking a -1.17% move from the prior day. This change lagged the S&P 500's 1.13% loss on the day. Elsewhere, the Dow lost 0.56%, while the tech-heavy Nasdaq added 0.16%.

Heading into today, shares of the maker of energy-efficient lighting had gained 38.18% over the past month, outpacing the Computer and Technology sector's loss of 12.18% and the S&P 500's loss of 7.59% in that time.

Wall Street will be looking for positivity from Wolfspeed as it approaches its next earnings report date. On that day, Wolfspeed is projected to report earnings of -$0.06 per share, which would represent year-over-year growth of 71.43%. Our most recent consensus estimate is calling for quarterly revenue of $239.72 million, up 53.08% from the year-ago period.

WOLF's full-year Zacks Consensus Estimates are calling for earnings of $0.12 per share and revenue of $1.05 billion. These results would represent year-over-year changes of +124% and +41.03%, respectively.

It is also important to note the recent changes to analyst estimates for Wolfspeed. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 5.75% higher. Wolfspeed currently has a Zacks Rank of #3 (Hold).

Digging into valuation, Wolfspeed currently has a Forward P/E ratio of 974.65. This represents a premium compared to its industry's average Forward P/E of 12.11.

The Semiconductor - Discretes industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 99, which puts it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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