Analyst: Wolfspeed Stock Could Jump 50% or More

The analyst joins an already bullish brokerage bunch

Deputy Editor
Oct 24, 2022 at 10:29 AM
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Shares of semiconductor developer Wolfspeed Inc (NYSE:WOLF) have given back their earlier gains, last seen down 0.7% at $105.13, even after a bull note from J.P. Morgan Securities. The firm upgraded WOLF to "overweight" from "neutral," and hiked its price target to $160 from $130. J.P. Morgan Securities noted that the silicon carbide-based hardware manufacturer could pop more than 50% thanks to increased capacity and potential to capitalize on greater electric vehicle (EV) production by 2030.

J.P. Morgan Securities isn't the first analyst to point out Wolfspeed stock's ability to pop on changes in the EV sector. Evercore ISI took a similarly bullish stance early last month. The brokerage bunch was already optimistic coming into today, too, with 11 of 16 calling WOLF a "buy" or better. Meanwhile, the 12-month consensus target price of $120.81 is a 14.2% premium to Friday's close.

According to the equity's 10-day put/call volume ratio of 1.42 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), puts are outpacing calls on an overall basis. This ratio stands in the elevated 93rd percentile of annual readings, which indicates that puts have rarely been more popular than over the last two weeks

What's more, WOLF's Schaeffer's Volatility Scorecard (SVS) ranks at 98 out of 100. This means the equity has exceeded option traders' volatility expectations during the last year.

On the charts, Wolfspeed stock continues to hold above its 320-day moving average since gapping above here in August after an upbeat earnings report. The security just logged its best week since that post-earnings pop, and boasts a 16.9% year-over-year lead.

 

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