Wolfspeed Soars to 52-Week High After $476 Million Refinancing

Overview

• Wolfspeed shares jumped about 25% to a new 52-week high near $36.60 following a balance-sheet deal that eased near-term debt pressure.
• The company raised roughly $475.9 million through a private placement that included $379 million of 3.5% convertible secured notes due 2031 plus about $96.9 million of stock and pre-funded warrants.
• Management used the proceeds to redeem about $475.9 million of senior secured notes that had been set to mature in 2030, which reduces refinancing risk for the next few years.
• Despite the surge, Wolfspeed is still losing money, with last quarter’s earnings at negative $6.11 per share, revenue down 6.6% year over year, and a gross margin of negative 14%.
• Analysts keep a cautious stance with a consensus Reduce rating and an average price target of $14.33, even as the company highlights new regional leaders and rising stakes from investors like Renesas, Goldman Sachs, and UBS.