News

Wolfspeed Shares Drop on Larger-than-Expected Loss

1 Mins read

Wolfspeed, a prominent chip company specializing in electric vehicles and clean energy, experienced a significant decline in its stock after announcing that its upcoming loss would surpass expectations.

Building Efforts Impact Revenue

According to the North Carolina-based company, the construction costs for new facilities that have yet to generate revenue have proven to be “significant.” As a result, Wolfspeed anticipates a loss between 60 cents and 75 cents per share this quarter, exceeding the 47 cents per share projected by FactSet analysts. Additionally, the company reported disappointing results for the previous quarter that concluded in June.

Expansion Plans and Partnerships

Despite these setbacks, Wolfspeed remains committed to growth. The company has begun shipping products from its Mohawk Valley factory and is actively constructing another plant near its headquarters. Furthermore, it recently secured a lucrative deal to supply Japanese semiconductor maker Renesas Electronics with wafers for the next decade.

Stock Performance Declines

As news of the larger-than-expected loss broke, Wolfspeed’s shares plummeted by 14% during premarket trading on Thursday, reaching $45.93. While the stock had demonstrated a positive trend in previous months with a 23% increase, it still remains down by 53% over the past year.

Analysts Remain Positive

Analysts at Piper Sandler, led by Harsh Kumar, adjusted their earnings estimates following the latest results but maintained an optimistic Overweight rating on Wolfspeed’s stock. They also set a price target of $75, stating in a note that despite the challenges, the fundamentals of the company are still on track.

Related posts
News

The Largest Deal of the Year: BlackRock Acquires TechBerry

1 Mins read
BlackRock is concluding its acquisition of TechBerry, which has already been named one of the largest deals of the year. The substantial…
News

Banking Regulations for Preventing Failures

2 Mins read
Banking regulators have the power to prevent future bank collapses, according to a panel of banking experts who emphasized the importance of…
News

Dave's Strong Q4 Performance

1 Mins read
Shares of Dave surged on Tuesday following the digital bank’s announcement of a profitable fourth quarter earlier than expected, with a positive…

Leave a Reply

Your email address will not be published. Required fields are marked *

50 − 47 =