Silicon Carbide (SiC) and Gallium Nitride (GaN) technology giant Wolfspeed (NYSE:WOLF) stock has been on a tear making new all-time highs since its transformation from Cree.
The Company is a leader in SiC-based semiconductors and devices. SiC chips have proven to have superior performance over traditional semiconductors in electric vehicles (EVs). SiC chips used in an EV powertrain delivers 13-to-1 energy savings versus traditional chips. This results in longer range, lighter weight, and faster charging. Ultimately, lower long-term energy usage, reduction of carbon emissions, and promotes enhanced environmental sustainability are also achieved.
Combined with GaN technologies, Wolfspeed provides solutions for applications in EVs, automotive, renewable energy, fast EV charging, 5G, storage, aerospace, and defense. Prudent investors seeking a next-gen level investment in chip technology can watch for opportunistic pullbacks in shares of Wolfspeed.
Q1 Fiscal 2022 Earnings Release
On Oct. 27, 2021, Wolfspeed released its fiscal first-quarter 2022 results for the quarter ending September 2021. The Company reported an earnings-per-share (EPS) loss of (-$0.21) excluding non-recurring items versus consensus analyst estimates for a loss of ($0.24), a $0.03 beat.
Revenues grew 35.6% year-over-year (YoY) to $56.6 million beating analyst estimates for $149.59 million. Wolfspeed CEO Gregg Lowe commented,
“We are pleased to report a solid fiscal first quarter, our fifth consecutive quarter of revenue growth bolstered by the rapidly expanding marketplace for Silicon Carbide products. We are driving the transition to Silicon Carbide-based solutions during a period of momentous change, which is demonstrated by our expanding list of customers and formal name change. We remain confident that the business is well positioned to realize its full potential as a pure-play global semiconductor powerhouse."
Upside Guidance
The Company raised Q2 fiscal 2022 EPS to come in between ($0.20) to (-$0.16) revenue versus (-$0.23) analyst estimates. Q2 fiscal 2022 revenues are expected between $165 million to $175 million versus $159.32 million.
Conference Call Takeaways
CEO Lowe kept it brief,
“I am pleased to report that during the first quarter, we continued to execute and drive our business, delivering strong revenue above our guidance and non-GAAP diluted earnings per share at the high-end of our guidance range. And this has been a momentous period for us, we changed our name to Wolfspeed, capitalizing on our 30-year plus heritage of working with silicon carbide.
"The next-generation in power semiconductors will be driven by silicon carbide technology with superior performance that unleashes new possibilities and positive changes to the way we live. As the original champion of this technology, we couldn't be more excited to compete and win in the rapidly expanding marketplace.
"As part of our move to Wolfspeed, we also are pleased to have joined the New York Stock Exchange earlier this month as we continue on our transformational journey of a pure-play global semiconductor powerhouse, leading the industry transition from silicon-to-silicon carbide.
"We look forward to discussing the strong progress we've made on our transformational journey and strategy and share more detail about this exciting long-term outlook during our Investor Day in New York City next month.”
WOLF Opportunistic Pullback Levels
Using the rifle charts on the weekly and daily time frames provides a precision view of the price action playing field for WOLF stock. The weekly rifle chart has been in a strong uptrend on the pup breakout with a rising 5-period moving average (MA) at $122.63. The initial body peaks formed near the $139.81 Fibonacci (fib) level.
The weekly stochastic squeezed up through the 80-band stochastic. The weekly upper Bollinger® Bands sit at $143.58. The daily rifle charts formed a breakdown with a falling 5-period MA at $133.16 as it crossed under the $134.32 daily 15-period MA. The daily stochastic is falling under the 80-band. The daily lower BBs sit near the daily market structure low (MSL) buy trigger at $86.30.
Prudent investors can watch for opportunistic pullback levels at $119.14 fib, $112.17 fib, $108.45 fib, $100.07 fib, $94.18 fib, $88.28 fib, and the $86.30 fib level. Upside trajectories range from the $150.00 fib to the $204.90 fib level.