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Wolfspeed (WOLF) Moves 7.9% Higher: Will This Strength Last?

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Wolfspeed (WOLF - Free Report) shares ended the last trading session 7.9% higher at $23.94. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 18.8% loss over the past four weeks.

Wolfspeed has evolved into a pure-play silicon carbide provider through portfolio optimization initiatives that concluded with the sale of its RF business. It expects to be one of the top silicon carbide device suppliers over the next five years thanks to first-movers’ advantage in 200-millimeter (mm) wafer volume production, which is the silicon carbide industry's most advanced technology.

This maker of energy-efficient lighting is expected to post quarterly loss of $0.64 per share in its upcoming report, which represents a year-over-year change of -392.3%. Revenues are expected to be $201.49 million, down 11.9% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Wolfspeed, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on WOLF going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Wolfspeed belongs to the Zacks Semiconductor - Discretes industry. Another stock from the same industry, Vishay Intertechnology (VSH - Free Report) , closed the last trading session 0.7% higher at $21.04. Over the past month, VSH has returned -5%.

For Vishay, the consensus EPS estimate for the upcoming report has changed -5.3% over the past month to $0.20. This represents a change of -74.7% from what the company reported a year ago. Vishay currently has a Zacks Rank of #4 (Sell).


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