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UPDATE: SMBC Nikko Securities Starts Wolfspeed (WOLF) at Outperform

March 28, 2022 4:38 PM EDT
Get Alerts WOLF Hot Sheet
Price: $108.08 --0%

Rating Summary:
    7 Buy, 1 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 5 | Down: 6 | New: 22
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(Updated - March 28, 2022 4:39 PM EDT)

SMBC Nikko Securities analyst Srini Pajjuri initiates coverage on Wolfspeed (NYSE: WOLF) with a Outperform rating and a price target of $140.00.

The analyst comments "We are initiating coverage on WOLF with an Outperform and $140 price target. The company is the undisputed leader in the silicon carbide (SiC) market, which is characterized by complex manufacturing and high barriers to entry. We expect SiC demand to outpace supply for the next several years driven by the electric vehicle (EV) megatrend and broader shift toward energy efficiency. WOLF's manufacturing know-how, vertically-integrated model, and industry-first 8" wafer fab are driving multi-year revenue visibility with a $20b+ design-in pipeline. In addition, we believe WOLF is better positioned to withstand any near term cyclical risks in Semi industry due to secular demand from the EV market. While execution risk is not insignificant, we are comfortable with management's FY24 outlook, which implies ~40% revenue CAGR and 15 points of GM expansion. At 11x CY23 EV/S, valuation is not inexpensive but is justified in our view given strong secular growth and significant technology/manufacturing moat."

For an analyst ratings summary and ratings history on Wolfspeed click here. For more ratings news on Wolfspeed click here.

Shares of Wolfspeed closed at $112.70 yesterday.


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