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To: John Carragher who wrote (4083)	10/16/2000 5:18:35 PM
From: straight life	Read Replies (2) \| Respond to of 10714

maybe Yogi jinxed it...? EOM

To: John Carragher who wrote (4083)	10/17/2000 12:47:28 PM
From: Tom Pulley	Read Replies (3) \| Respond to of 10714

John, for what its worth, I'll give you my thoughts on Cree's stock performance. On top of the decline in semi's, my belief is that the problem with Cree now is that revenue growth on a sequential basis is decelerating. Sequential Revenue growth excluding interest income for the Dec'99, March'00, June'00, and Sept'00 are 19%,19%,13%,13% respectively. If you look at Product Revenue only, the numbers are 21%,18%,15%,and 14%. The recent growth numbers are excellent and meet company forecasts, but I think for the stock price to outperform we need to see revenue growth accelerating. I expected Cree to have accelerating growth in product revenues due to higher yields, added equipment, and transition to 3" wafers; combined with high demand. Unfortunately the transition to 3" wafers won't hit until next calendar year, and apparently the yield improvements offset lower selling prices but don't provide for accelerating growth. On top of this, note that sequential earnings dropped to a 13% growth rate versus last quarter's 20% increase. The market was expecting more (as was I). The stock likely won't be a great performer until the potential for accelerating revenue growth and earnings growth is clear. Hopefully that will occur early next year as the first phase of the manufacturing facility comes on line, 3" wafers happen, new ultra-HB LED's ship (hopefully holding up avg prices), and RF starts to ship in higher quantities. Sometime between now and yearend 2001, I believe this stock will rocket upward as LED growth continues and RF devices result in significant added growth. When that will occur, I wish I knew. Since I don't, I have to be a LTB&H investor (painful as it is these days). Tom