UPDATE: JPMorgan Downgrades Cree (CREE) to Underweight
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JPMorgan analyst Paul Coster downgraded Cree (NASDAQ: CREE) from Neutral to Underweight with a price target of $108.00.
The analyst comments "We downgrade CREE to Underweight on valuation. CREE is trading at nearly 15 times forward EV/Sales and at massive 2021E and 2022E P/E and EV/EBITDA multiples (CREE is currently under-earning owing to investment in SiC capacity) and in our view, the stock looks fully-valued even for patient investors taking a longer-term view of the company’s earnings power and discounting back to the current day. Moving to Underweight rating means we expect CREE to underperform the mean of our coverage universe over the next 6-12 months, though we do not view the stock as a short owing to the potential for large long-term contracts to be announced at any time."
Shares of Cree closed at $112.73 yesterday.
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