Another very impressive quarter for Cree Inc (CREE) and traders are responding after hours by sending the stock up nearly 10% back to the big resistance area around 60. It will be interesting to see if it can take out that level and find a new level of support. I’m skeptical and if I were holding this stock into earnings, I’d be taking some profits off the table into the gap up tomorrow.
The company reported a non GAAP EPS of .38/share which beat the consensus estimate of .30 by a wide margin. Revenues were equally impressive at $199.5 million which was above the Wall St estimate of $186 million. That’s good for a 90% increase in EPS and 35% increase in revenues over the year ago quarter.
Looking ahead to next quarter, the company sees revenues of $215 – 225 million with an EPS of .41-.44/share. That’s well ahead of analyst estimates as well. Clearly a company running on all cylinders as the move to LED lighting takes hold. The stock looks mighty overdone up here though.
CEO Chuck Swoboda commented saying, “We continued to execute very well in Q2, as we delivered record revenue and net income,. “LED lighting adoption continues to gain momentum and our near term focus is on factory execution and capacity expansion. Our strong balance sheet further enhances our leadership position and supports our mission of leading the LED lighting revolution.”
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Excellent post, However I think you may want to jump in on CREE at this point, I have been in and out of this stock for over 5 years and I can honestly say that I think it is going to 80 within the next 3 months, If you listen to the conference calls you would notice a pattern of confidence and excellent management in a company that has just starting to rapidly grow, I think you are going to see their earning and margins really gain over the next 2 quarters and with that the P/E will be coming down and the company will not look overdone like you noted above. CREE still has a long way to go and their is a lot of momentum and institutional buyers that could push this stock much much higher, I am in again at $50 after owning at $12, $25 and $34.
After blow out earning like last night I have seen CREE move up or down the following day but either way CREE always recovers within 5 days and continues its trend, look at the chart on this stock as well, It is fantastic showing higher lows and higher highs week after week and if it holds above $60 mark my word it is going to $80 easily!