Cree Inc. [NASDAQ: CREE] slipped around -12.37 points on Monday, while shares priced at $94.12 at the close of the session, down -11.62%. The company report on March 1, 2021 that Cree Completes Sale of its LED Business to SMART Global Holdings, Inc.
Cree, Inc. (Nasdaq: CREE), the global leader in silicon carbide technology through its Wolfspeed® business, announced that it has completed the previously announced sale of its LED Products business unit (“Cree LED”) to SMART Global Holdings, Inc. (Nasdaq: SGH) effective. SMART will now license and incorporate the Cree LED brand name into the SMART portfolio of businesses, and Cree will change its corporate name to Wolfspeed later this year. Under the transaction terms Cree will receive up to $300 million, which consists of a $50 million cash payment at close and a $125 million seller note to be paid upon maturity in 2023. Cree also has the potential to receive an earn-out payment of up to $125 million based on the revenue and gross profit performance of Cree LED in the first full four quarters post-transaction close, also payable in the form of a three-year seller note.
“The completed sale of Cree LED represents a major milestone in our transformational journey, establishing the company as a pure-play global semiconductor powerhouse, well positioned to lead the industry transition from silicon to silicon carbide,” said Gregg Lowe, Cree CEO. “As industries across the globe look to increase efficiency and performance with smaller, more scalable power systems, this evolution sharpens our focus and strengthens our continued investments to capitalize on multi-decade growth opportunities for Wolfspeed silicon carbide and GaN solutions across EV, 5G and industrial applications.”.
Cree Inc. stock is now -11.12% down from its year-to-date (YTD) trading value. CREE Stock saw the intraday high of $107.13 and lowest of $94.09 per share. The company’s 52-week high price is 129.90, which means current price is +0.03% above from all time high which was touched on 02/11/21.
Compared to the average trading volume of 1.97M shares, CREE reached a trading volume of 2298150 in the most recent trading day, which is why market watchdogs consider the stock to be active.
What do top market gurus say about Cree Inc. [CREE]?
Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for CREE shares is $116.77 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on CREE stock is a recommendation set at 2.60. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.
BofA Securities have made an estimate for Cree Inc. shares, keeping their opinion on the stock as Buy, with their previous recommendation back on March 01, 2021. While these analysts kept the previous recommendation, Cowen dropped their target price from $90 to $150. The new note on the price target was released on February 22, 2021, representing the official price target for Cree Inc. stock. Previously, the target price had yet another raise from $105 to $160, while Citigroup kept a Buy rating on CREE stock. On January 28, 2021, analysts increased their price target for CREE shares from 105 to 150.
The Average True Range (ATR) for Cree Inc. is set at 8.80, with the Price to Sales ratio for CREE stock in the period of the last 12 months amounting to 15.08. The Price to Book ratio for the last quarter was 5.59, with the Price to Cash per share for the same quarter was set at 9.11.
How has CREE stock performed recently?
Cree Inc. [CREE] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -20.53. With this latest performance, CREE shares dropped by -20.03% in over the last four-week period, additionally plugging by 53.89% over the last 6 months – not to mention a rise of 114.45% in the past year of trading.
Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for CREE stock in for the last two-week period is set at 36.79, with the RSI for the last a single of trading hit 31.98, and the three-weeks RSI is set at 40.54 for Cree Inc. [CREE]. The present Moving Average for the last 50 days of trading for this stock 113.12, while it was recorded at 105.34 for the last single week of trading, and 79.70 for the last 200 days.
Cree Inc. [CREE]: Deeper insight into the fundamentals
Operating Margin for any stock indicates how profitable investing would be, and Cree Inc. [CREE] shares currently have an operating margin of -18.13 and a Gross Margin at +25.87. Cree Inc.’s Net Margin is presently recorded at -21.21.
Return on Total Capital for CREE is now -6.06, given the latest momentum, and Return on Invested Capital for the company is -7.11. Return on Equity for this stock declined to -9.31, with Return on Assets sitting at -6.34. When it comes to the capital structure of this company, Cree Inc. [CREE] has a Total Debt to Total Equity ratio set at 39.01. Additionally, CREE Total Debt to Total Capital is recorded at 28.06, with Total Debt to Total Assets ending up at 25.15. Long-Term Debt to Equity for the company is recorded at 38.59, with the Long-Term Debt to Total Capital now at 27.76.
Reflecting on the efficiency of the workforce at the company, Cree Inc. [CREE] managed to generate an average of -$37,368 per employee. Receivables Turnover for the company is 7.24 with a Total Asset Turnover recorded at a value of 0.30.Cree Inc.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 3.50 and a Current Ratio set at 3.80.
Earnings analysis for Cree Inc. [CREE]
With the latest financial reports released by the company, Cree Inc. posted -0.14/share EPS, while the average EPS was predicted by analysts to be reported at -0.15/share. When compared, the two values demonstrate that the company surpassed the estimates by a Surprise Factor of 6.70%. The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for CREE.
Insider trade positions for Cree Inc. [CREE]
There are presently around $11,085 million, in the hands of institutional investors. The top three institutional holders of CREE stocks are: BLACKROCK INC. with ownership of 14,072,356, which is approximately 8.032% of the company’s market cap and around 0.60% of the total institutional ownership; CAPITAL RESEARCH GLOBAL INVESTORS, holding 13,517,839 shares of the stock with an approximate value of $1.27 billion in CREE stocks shares; and VANGUARD GROUP INC, currently with $955.8 million in CREE stock with ownership of nearly 2.538% of the company’s market capitalization.
Positions in Cree Inc. stocks held by institutional investors increased at the end of January and at the time of the January reporting period, where 218 institutional holders increased their position in Cree Inc. [NASDAQ:CREE] by around 12,881,244 shares. Additionally, 162 investors decreased positions by around 12,132,613 shares, while 43 investors held positions by with 92,763,162 shares. The mentioned changes placed institutional holdings at 117,777,019 shares, according to the latest SEC report filing. CREE stock had 95 new institutional investments in for a total of 2,692,176 shares, while 38 institutional investors sold positions of 1,483,067 shares during the same period.