Piper Jaffray Remains Neutral As Cree (CREE) Inventories Rise

Piper Jaffray maintains a Neutral rating and $35.00 price target on Cree (NASDAQ: CREE) as store level inventories are rising. Cree lamp SKUs are showing the effect of competitor pricing.

Analyst Mike Ritzenthaler commented, "Weekly retail store-level inventories of specific Cree lamp SKUs are showing the effect of competitors’ introduction of several sub-$5 price point 60W equivalent lamps (+10% m/m in May over April). Retail inventory levels of these particular Cree lamps are at their highest levels since we began tracking the data 7 months ago and levels appear to be gathering momentum over the past 3 weeks. Although the retail effects of a handful of retail SKUs may not have an immediately material impact to Cree’s P&L, we are incrementally more concerned about the on-going competitiveness and profitability of Cree’s operating model given the constant pricing pressure in the retail channel and the potential impact on the more important C&I margins. We maintain our Neutral rating and $35 price target."

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 $30.64 yesterday.

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