The 10-second takeaway
For the quarter ended Sep. 23 (Q1), Cree met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share grew significantly.
Gross margins shrank, operating margins dropped, net margins increased.
Cree recorded revenue of $315.8 million. The 28 analysts polled by S&P Capital IQ expected net sales of $317.6 million on the same basis. GAAP reported sales were 17% higher than the prior-year quarter's $269.0 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 $0.27. The 29 earnings estimates compiled by S&P Capital IQ averaged $0.26 per share. GAAP EPS of $0.14 for Q1 were 27% higher than the prior-year quarter's $0.11 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 36.8%, 50 basis points worse than the prior-year quarter. Operating margin was 5.8%, 140 basis points worse than the prior-year quarter. Net margin was 5.1%, 30 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $332.3 million. On the bottom line, the average EPS estimate is $0.29.
Next year's average estimate for revenue is $1.34 billion. The average EPS estimate is $1.21.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,114 members out of 1,202 rating the stock outperform, and 88 members rating it underperform. Among 216 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 196 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 $32.77.
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