Wolfspeed Inc. shares plunge 50% in after-hours trading.

Wolfspeed Inc. shares plunge 50% in after-hours trading.

Wolfspeed Inc. (WOLF) experienced a significant drop in its stock price during after-hours trading on May 20, 2025, with shares falling by 50% to settle at $3.54. This marked a substantial decline from the previous closing price of $7.08 on May 19, 2025 [1].

The drop in stock value comes amidst ongoing market fluctuations and investor scrutiny over Wolfspeed's performance indicators. Analysts have been closely monitoring the company's financial health and future investment strategies [1].

According to Wall Street analysts, the average one-year price target for Wolfspeed Inc. is $4.41, with a high estimate of $12.70 and a low estimate of $2.00. This average target implies an upside of 25.00% from the current price of $3.53 [1]. The consensus brokerage recommendation from 12 firms is currently "Hold," indicating a cautious outlook on the company's stock [1].

GuruFocus estimates that the GF Value for Wolfspeed Inc. in one year could be $33.64, suggesting an upside of 853.24% from the current price of $3.529. GF Value is calculated based on historical multiples and future performance estimates [1].

Wolfspeed Inc. reported mixed financial results for the third quarter of its fiscal year. The company achieved a sequential revenue growth of 50% at Mohawk Valley, contributing $78 million in revenue. However, non-GAAP gross margin was only 2.2%, and adjusted EPS was negative $0.72 per share, indicating challenges in achieving higher profitability [1].

The company also announced significant restructuring efforts, including a 30% reduction in the senior leadership team and projected restructuring charges of $400 million to $450 million for fiscal 2025. These restructuring efforts are expected to impact the company's cash flow, with free cash flow during the quarter being negative $168 million [1].

The recent stock price decline could be attributed to several factors, including the company's ongoing restructuring, negative earnings per share, and challenges in achieving higher profitability. Investors are closely monitoring Wolfspeed Inc.'s performance and future prospects.

References:
[1] https://www.gurufocus.com/news/2874152/wolfspeed-wolf-shares-decline-over-9-wolf-stock-news
[2] https://www.marketbeat.com/stocks/NYSE/WOLF/