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Technology Stocks : Wolf speed -- Ignore unavailable to you. Want to Upgrade?

To: unclewest who wrote (1452)	1/3/2000 10:10:00 PM
From: Ron	Read Replies (1) \| Respond to of 10713

The New York Times story, which draws from The Street.com website...interesting, especially since this is the first time I can remember the NYT featuring a smaller company's earnings report such as CREE. Second-Quarter Earnings for Cree Beat Expectations By CAROLYN KOO NYTimes.com/TheStreet.com Cree, which changed its name from Cree Research on Jan. 1, announced strong second-quarter earnings Monday morning, beating expectations. The company is also set for a stock offering of 2.6 million shares. For the second quarter of fiscal 2000 ended Dec. 26, 1999, net income doubled 103 percent, to $5.78 million, or 18 cents a diluted share, from $2.85 million, or 10 cents a share (adjusted for a two-for-one stock split last July) a year earlier. Earnings per share came in 2 cents above the consensus estimate of sell-side analysts polled by First Call/Thomson Financial. Revenue of the Durham, N.C.-based company rose to $23.93 million from $14.04 million a year ago, an increase of 70 percent. The company, which develops, manufactures and markets silicon carbide-based semiconductor devices, attributed the earnings gain to higher profit margins on its products and increased sales for its high-brightness light-emitting diode devices. Product revenue grew 73 percent as compared to a year ago, to $22.14 million from $12.81 million, while high-brightness LED devices accounted for 71 percent of LED sales during the quarter. The company did not break down revenue figures for its products. However, the company did indicate that in the June 1999 fiscal year LEDs accounted for half of revenue, jewelry (artificial diamonds) 15 percent to 20 percent, and electronic telecommunications applications the balance. Linc Werden, an analyst at H.G. Wellington estimated that for this quarter LEDs accounted for a greater part of revenue and jewelry less. Werden rates Cree a buy and his firm was part of the syndicate for the company's secondary stock offering last February. "The LED market and the electronic telecommunications applications market continue to be dynamic," said Werden, citing the company's two most successful markets. "Its bright green and blue LEDs especially are harder to make and command a higher price. That's a higher margin market, with the fastest growth and the most in demand." Cree has no main competition when it comes to using silicon carbide to make LEDs, but Hewlett-Packard makes lower-end red and yellow LEDs, with other materials. Cree closed Monday down 1, or 1 percent, to 83 15/16. Cree has filed a registration statement with the Securities and Exchange Commission for the stock offering. Proceeds will be used to expand its manufacturing facility, purchase additional equipment and acquire an additional facility, among other things. The company can avoid dilution by adding capacity, or more incremental earnings. Underwriters for the offering are CIBC World Markets, Prudential Volpe Technology Group (a unit of Prudential Securities), Banc of America Securities, SoundView Technology Group and Morgan Keegan & Company.