Wolfspeed: Big Plans Still Intact

2025-01-31 12:36:33 ET

Summary

• Wolfspeed remains poised for strong growth in the EV ecosystem despite short-term struggles and a CEO transition with a viable path to profitability.
• The company reported mixed FQ2 results, with revenues down 13% YoY, but maintains a massive $30 billion order book and strong future prospects.
• Wolfspeed's limited future capital requirements and significant cost cuts position it for EBITDA positivity at $1 billion in sales, reducing financial survivability fears.
• Investors should capitalize on the stock's weakness to build positions in this silicon carbide leader as financial risks diminish and growth potential becomes clearer.

Wolfspeed, Inc. (WOLF) still remains on track for a strong future in the EV ecosystem. The silicon carbide company is in the process of replacing the CEO, but the future is extremely positive. My investment thesis is ultra-bullish on the stock trading near lows in the $6s despite a viable path to profits with reduced capex spending going forward....

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