Wolfspeed Inc. (WOLF) stock soared 17.92% in pre-market trading on Tuesday, continuing its impressive rally from the previous day. This surge follows a 26% increase on Monday and a 4% jump in overnight trading, indicating strong momentum for the semiconductor company.

The remarkable rise in Wolfspeed's stock price may be attributed to a short squeeze scenario. According to Raymond James analysts, Wolfspeed topped the list of stocks with the largest short-interest ratio at 41%. This high level of short interest could be driving investors to cover their positions, leading to increased buying pressure and pushing the stock price higher.

The semiconductor industry has been experiencing heightened levels of short interest, as noted by Raymond James. Wolfspeed's significant price movement reflects the volatility and speculative nature of the sector. As a key player in the semiconductor space, Wolfspeed's stock performance is likely drawing attention from both long-term investors and short-term traders looking to capitalize on the current market dynamics.