Wolfspeed Stock Eyes Finishing Troubled Week Higher On Insider Buying Boost: Retail Regains Confidence
By Stocktwits Inc | First Published Nov 22, 2024, 11:42 PM ISTAdding to the renewed enthusiasm, Roth MKM analyst Craig Irwin maintained a ‘Buy’ rating with a $20 price target after hosting meetings with Wolfspeed’s management.
Shares of Wolfspeed Inc. ($WOLF), a prominent manufacturer of silicon carbide (SiC) semiconductors used in electric vehicles (EVs), surged over 20% on Friday, reaching one-week highs after significant insider buying boosted investor sentiment.
SEC filings revealed that Wolfspeed directors collectively purchased shares worth approximately $817,000 this week. The purchases included notable buys from Interim CEO Thomas Werner, Duy-Loan Le, Stacy Smith, and Darren Jackson.
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That has helped counteract recent concerns over management changes and weaker financial performance.
Earlier this week, Wolfspeed announced the sudden departure of CEO Gregg Lowe, prompting the board to begin a search for a permanent replacement.
Financial challenges have also weighed on the stock, as the company earlier this month reported fiscal first-quarter revenue that missed expectations and issued second-quarter guidance well below estimates. The company also disclosed plans to reduce its workforce by 20% in an effort to streamline its cost structure.
Retail sentiment on Stocktwits has shifted dramatically, flipping from ‘extremely bearish’ to ‘extremely bullish’ by Friday afternoon, with message volume more than doubling over the past week.
On the platform, a poll reveals that 71% of retail investors believe it is the right to buy WOLF stock as the insider stock buys are bullish, while 13% believe it’s too risky and prefer staying out instead.
Adding to the renewed enthusiasm, Roth MKM analyst Craig Irwin maintained a ‘Buy’ rating with a $20 price target after hosting meetings with Wolfspeed’s management.
Irwin highlighted the company’s strategic importance as a U.S. leader in SiC semiconductor materials and noted that increased demand for 200mm SiC wafers could act as a significant catalyst for growth.
Despite Friday’s rally, Wolfspeed shares remain down over 80% for the year, reflecting challenges such as the uncertain future of EV subsidies following Donald Trump’s election victory, which has raised concerns about SiC demand.
Last month, the company captured investor attention after saying it was set to receive $750 million in U.S. government grants and an additional $750 million in financing led by Apollo Global Management to support its expansion efforts.
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