Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: LED maker Cree (Nasdaq: CREE) defied a market sell-off and popped 17% in intraday trading after reporting better-than-expected earnings and indicating demand is improving.

So what: Fourth fiscal quarter non-GAAP EPS of $0.28 fell 49% year over year but beat the $0.27 consensus estimate. GAAP EPS of $0.18 fell from $0.48 in the year-ago quarter. Revenue of $243 million fell 8% year over year.

Now what: Cree's CEO said that over the last year, the company has managed a "challenging business cycle" for its LED component and chip products and grown its LED lighting business. Looking ahead, he stated that "demand has improved from earlier in the calendar year." Guidance for the current quarter calls for revenue of $245 million to $255 million and non-GAAP EPS of $0.25 to $0.28. Cantor Fitzgerald said Cree's margins likely troughed last quarter and recommended investors "aggressively accumulate shares at the current depressed valuation to take advantage of a multi-year secular growth trend in solid state lighting."

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