Wolfspeed faces a dire financial outlook following its June 30, 2025, Chapter 11 bankruptcy filing, with the stock price plummeting nearly 70% year-to-date. Despite Wall Street projections of a turnaround by 2028, the company must first navigate massive near-term hurdles, including an estimated negative free cash flow of $2.43 billion in fiscal 2026 and $1.74 billion in 2027. A discounted cash flow analysis reveals an intrinsic value of $2.08 per share, nearly identical to the current market price of $2.01, suggesting no margin of safety for investors. The company’s capital structure is heavily burdened by over $6.5 billion in debt against a meager $314 million market cap, resulting in a high 12% cost of debt. Given the extreme volatility, excessive leverage, and the long timeline required for a potential recovery, the stock remains a hold rather than a buy.
Sign in to continue reading, translating and more.
Continue
