Piper Jaffray Sees Q2 Beat from Cree (CREE); Cuts Q3 Estimates But Remains Very Bullish

January 9, 2012 3:14 PM EST
Get Alerts CREE Hot Sheet
Price: $27.66 +0.77%

Rating Summary:
    12 Buy, 23 Hold, 5 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 11 | Down: 20 | New: 54
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Cree (Nasdaq: CREE) shares are outperforming the broader stock market handily Monday afternoon as Piper Jaffray's Ahmar Zaman issued a note this morning suggesting the company will beat the Street's second-quarter expectations on Tuesday, January 17th. Zaman maintains an Overweight rating and $50 price target on shares of Cree.

Zaman cites an expected increase in rush orders to China. The analyst's checks indicate demand for LED street lighting within China has now recovered, showing about 30 percent growth compared to last year.

Zaman warned growth during the third quarter may be more modest given demand pull-in ahead of the Chinese New Year. The analyst slightly reduced his third-quarter EPS estimate on Cree from 36 cents to 33 cents. Zaman's third-quarter sales estimate moved from $355 million to $336 million. The Street is currently anticipating third-quarter EPS of 30 cents on sales of $322.98 million.

With shares of Cree up 2.6 percent to $23.02 Monday afternoon, Piper Jaffray's price target implies potential upside of more than 115 percent.

Visit our Analyst Ratings page to track all the market-moving calls on shares of Cree.

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