We recently published a list of 11 Stocks That Will Go to the Moon According to Reddit. In this article, we are going to take a look at where Wolfspeed, Inc. (NYSE:WOLF) stands against other stocks that will go to the moon according to Reddit.
Will the Market Broaden in 2025?
The earnings season is upon us and the investors are excited to see how the market sets the pace for the rest of 2025. On January 14, Thomas Martin, senior portfolio manager at GLOBALT Investments, appeared in an interview on Wealth at Yahoo Finance to share his outlook on the market and the sectors he expects to grow.
Martin shared that strategists have been putting out their target price for the S&P 500 since November 2024, which happens to be particularly wide. However, in 2025, the market is seeing one of the lowest rates of standard deviation in a while. In addition to that, the rate of return based on the targets in November is around 10% which is in line with the long-term average of the S&P 500. Based on this, Martin concluded that analysts are conservative with their estimates and are not willing to make bets on the outliers.
With uncertain policies, inflation expectations, and interest rates, he believes that the market will either experience a “down market” or a “very strong up-market” by the end of 2025. Martin also added that he expects 15% overall earnings growth followed by a 10% rate of return, emphasizing that this combination may result in the contraction of multiples. He shared that the contraction may happen because of several factors, especially interest rates being higher than usual.
Martin is extremely bullish on the financials, information technology, and communication services industries. He also expects some growth in the healthcare sector as the market broadens out. He also suggested that an optimal product portfolio will include names with strong fundamentals and sound financial performance. He added that diversification is particularly important and emphasizes the need for cash in emergency situations.
As Martin suggested, a safer portfolio is more diversified and involves names with stronger fundamentals. However, at the same time, some stocks are garnering immense traction from people on social media because of their growth potential and sound financial performance.
Our Methodology
To come up with the 11 stocks that will go to the moon we surfed through important threads and picked the 25 most popular stocks. We then examined the analyst upside for each stock and picked the top 11 with the highest upside as of January 14, 2025. We have also included the hedge fund sentiment as of Q3 2024 for each stock.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A worker assembling metal oxide semiconductor field effect transistors (MOSFETs) on a conveyer belt.
Wolfspeed, Inc. (NYSE:WOLF)
Analyst Upside as of January 14, 2025: 162%
Number of Hedge Fund Holders: 26
Wolfspeed, Inc. (NYSE:WOLF) develops and manufactures semiconductors that power the next generation of disruptive innovations. Its products include silicon carbide material, power modules, and discrete power devices. In the later part of 2024, WOLF has focused on improving its capital structure, business structure, and profitability across primary segments.
In the first fiscal quarter of 2025, Wolfspeed, Inc. (NYSE:WOLF) generated $195 million in consolidated revenue. Of this, its Mohawk Valley Fab contributed nearly $49 million. The company poses a solid growth opportunity, as it builds its footprint in its factories at Mohawk Valley and North Carolina. The two locations are expected to return $3 billion in revenue annually. George Gianarikas, an analyst at Canaccord Genuity, maintained a buy rating on the stock and set a price target of $18, on December 10.
In addition to the company’s performance and forward outlook, Gianarikas shared a buy rating because of the company’s strategic decisions which are expected to boost its financial performance. For example, the company recently initiated an “at the market” offering worth $200 million, which happens to align with the CHIPS Act. The Street is also bullish on the stock, and analysts’ median price target implies an upside of 162% from current levels, as of January 14, 2025.
Overall, WOLF ranks 1st on our list of stocks that will go to the moon according to Reddit. While we acknowledge the potential of WOLF to grow, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than WOLF but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
