Wolfspeed: Recovery Unlikely, Reiterate Strong Sell

2025-05-22 08:00:00 ET

Summary

• Wolfspeed's stock has collapsed over 99% and faces imminent bankruptcy, with no place in any portfolio—my strong sell rating stands.
• Q3 earnings revealed collapsing gross margins and widening losses, highlighting an unsustainable business model and a worsening financial position.
• Management's attempts at capital restructuring and rescue financing appear futile, with no credible path to profitability or debt reduction.
• Even if short-term survival is achieved, the odds of equity value going to zero remain extremely high—there is nothing to like here.

Embattled semiconductor stock Wolfspeed ( WOLF ) was decimated in Wednesday’s trading, falling a staggering 59% on the session. The stock is now just over $1, a decline of more than 99% from its prior peak. Earlier this week, the WSJ reported that Wolfspeed was imminently going to file for bankruptcy ....

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