Needham & Company Remains Sidelined on Cree (CREE) Headed into 2016

Needham & Company reiterated a Hold rating on Cree (NASDAQ: CREE) heading into 2016. Needham sees limited recovery of CREE's LED component business, which will continue to be pressured by weak pricing and market shifts away from its high-power LEDs. The recently completed restructuring efforts are expected to help stabilize margins in the coming quarters.

Analyst Edwin Mok commented, "Going into 2016, we see limited recovery of CREE's LED component business, which will continue to be pressured by weak pricing and market shifts away from its high-power LEDs. While we believe CREE will be able to grow its commercial lighting business, given market adoption of LED lighting in the U.S., we believe persistent pressure in the retail lighting space will limit overall growth of the lighting segment. We expect the recently completed restructuring efforts to help stabilize margins in the coming quarters, but see room for more margin improvement. We believe the stock will likely trade sideways until the industry shows signs of recovery. Increased push by investors for breakup/buyout, and/or a sizable accretive acquisition could also be a positive catalyst to rejuvenate the stock."

For an analyst ratings summary and ratings history on Cree click here. For more ratings news on Cree click here.

Shares of Cree closed at $28.09 yesterday.

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