Wolfspeed At A Crossroads: Analyst Points To Competitive Pressures, EV Slowdown Impact
Portfolio Pulse from Anusuya Lahiri
Mizuho analyst Vijay Rakesh initiated coverage on Wolfspeed Inc (NYSE:WOLF) with a Neutral rating and a price target of $30, citing competitive pressures and a slowdown in the EV market as potential challenges. Despite Wolfspeed's leading position in the Silicon Carbide (SiC) market, increased competition and capacity expansions could lead to pricing pressures and margin challenges. Wolfspeed's stock has lost over 54% in value in the last 12 months. Investors can also gain exposure to Wolfspeed through SPDR S&P Semiconductor ETF (NYSE:XSD) and Amplify ETF Trust Amplify AI Powered Equity ETF (NYSE:AIEQ).
April 05, 2024 | 5:53 pm
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NEGATIVE IMPACT
Amplify ETF Trust Amplify AI Powered Equity ETF, holding Wolfspeed shares, might be indirectly influenced by Wolfspeed's current market and competitive challenges.
Given Wolfspeed's challenges and its inclusion in AIEQ's holdings, the ETF could experience indirect negative impacts, affecting investor sentiment in the short term.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 50
NEGATIVE IMPACT
Wolfspeed faces competitive pressures and an EV market slowdown, which could impact its margins and pricing despite its market leadership in SiC technology.
The initiation of coverage by Mizuho with a Neutral rating and concerns over competitive pressures and EV market slowdown directly impact investor sentiment towards Wolfspeed, likely leading to short-term price pressure.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100
NEGATIVE IMPACT
SPDR S&P Semiconductor ETF, which includes Wolfspeed in its holdings, may see indirect impact from the challenges faced by Wolfspeed.
As Wolfspeed faces potential challenges, it could indirectly affect the performance of ETFs like XSD that hold Wolfspeed stocks, potentially leading to short-term negative sentiment among investors.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 50