The 10-second takeaway
For the quarter ended June 24 (Q4), Cree met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly and GAAP earnings per share shrank significantly.
Margins dropped across the board.
Cree reported revenue of $306.8 million. The 30 analysts polled by S&P Capital IQ predicted a top line of $306.1 million on the same basis. GAAP reported sales were 26% higher than the prior-year quarter's $243.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.25. The 31 earnings estimates compiled by S&P Capital IQ predicted $0.23 per share. GAAP EPS of $0.09 for Q4 were 50% lower than the prior-year quarter's $0.18 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 34.8%, 330 basis points worse than the prior-year quarter. Operating margin was 3.3%, 530 basis points worse than the prior-year quarter. Net margin was 3.3%, 490 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $326.4 million. On the bottom line, the average EPS estimate is $0.27.
Next year's average estimate for revenue is $1.39 billion. The average EPS estimate is $1.32.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,117 members out of 1,205 rating the stock outperform, and 88 members rating it underperform. Among 223 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 203 give Cree a green thumbs-up, and 20 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cree is outperform, with an average price target of $34.43.
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