Wolfspeed (WOLF) – A Deep Value Play or a Target Under Siege?Personally, I’ve been keeping a close eye on Wolfspeed’s progress this year. There have been plenty of hurdles, big red days, and clear signs of aggressive shorting. But despite the blood in the water, I believe this company holds serious long-term value. With the global electrification trend accelerating—EVs, renewables, industrial upgrades—Wolfspeed is at the core of this transformation through its leadership in silicon carbide (SiC) technology.
I´ve been buying form the start of the year and currently own 2739 shares with the average price of 4,1.
✅ Bullish Catalysts (Upside Potential)
Market Cap: $604.61M
Shares Outstanding: 155.63M
Short Interest: 67.17M shares (43.53% of float)
Short Shares Available: Only 150K
Borrow Rate: 79.17% (!!)
Something doesn’t add up here...
With this level of short interest and borrow costs, it feels like either someone wants to short this to zero or they're trying to take over the company.
Bullish Catalysts (Upside Potential)
Electrification Megatrend: EVs, renewables, and energy storage demand Wolfspeed's SiC chips.
SiC Monopoly Moves: WOLF owns the world’s largest SiC fab (Mohawk Valley), positioning itself for high-margin dominance.
Short Squeeze Setup: 43% short interest + 79% borrow rate = explosive squeeze potential if any positive catalyst hits.
Government Subsidies: IRA, CHIPS Act, and local subsidies could ease funding stress.
Takeover Target: At just $600M market cap, Wolfspeed is ripe for M&A by a larger chipmaker or automotive OEM.
Long-Term Demand: Tesla, Onsemi, Infineon and others are doubling down on SiC—the market is expected to 10x by 2030.
❌ Bearish Catalysts (Risks & Headwinds)
Cash Burn & Dilution Risk: Fabs are expensive. Cash burn remains a serious concern—future capital raises may dilute shareholders.
Earnings Underperformance: Recent quarters have missed expectations, with weak utilization at new facilities.
Execution Risk: Delays in ramping up production at Mohawk Valley create uncertainty.
Competitor Pressure: STMicro, Infineon, and Onsemi are catching up fast in SiC.
Short Pressure Not Easing: No sign of shorts covering despite massive pressure. That suggests confidence in further downside.
Macro Headwinds: Rate hikes, EV demand softening, and recession fears hurt sentiment.
🔍 Conclusion
This setup is binary. Either:
Shorts are right and WOLF crumbles under its debt and execution failures.
Or they're wrong, and the combination of short squeeze + strategic value unleashes massive upside.
I’m leaning toward the latter. 📈
If bulls can defend key support levels and we get even a whiff of positive news (earnings beat, new contract, gov. subsidy, insider buy)—this stock could rip. Entry below 5 bucks seems like a good deal to me.
Watch it closely. High risk. High reward.
Disclaimer :
This post was written with the help of AI assistance, as English is not my native language. The content is for informational and discussion purposes only and does not constitute financial advice. Always do your own research and consult with a licensed financial advisor before making investment decisions.
