Cree Stock Keeps Crumbling on Bear Note

The analyst also slashed its CREE target price to $38

Digital Content Manager
Aug 26, 2019 at 9:46 AM
facebook twitter linkedin


Lighting manufacturer Cree, Inc. (NASDAQ:CREE) is sinking today, after Piper Jaffray issued a bear note. The analyst downgraded the stock to "underweight" from "neutral," and slashed its price target to $38 from $57, citing the firm's quarterly guidance due to the recent Huawei ban. The stock has lost 2.6% so far to trade at $45.90. 

If this negative price action holds through the close, today could mark the equity's sixth straight loss, as well as its lowest close since January. CREE took a major blow last week, finishing with a 19.9% weekly drop, its worst in roughly six years. Despite this dip, however, the security is still nearly 10% higher year-to-date.

CREE is no stranger to negative analyst attention, with seven brokerages in coverage calling it a "hold' or worse, compared to only two saying the equity is a "strong buy." The consensus 12-month target price of $55.88, though, is at a 21.2% premium to last Friday's close. 

Pessimism has pervaded the options pits, too. On the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), CREE sports a 10-day put/call volume ratio of 2.17, which suggests that puts have more than doubled calls during the past two weeks. What's more, this ratio sits higher than all but 1% of readings from the past year, indicating a much healthier appetite for bearish bets over bullish of late.    

 

If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!

 


 


 
Special Offers from Schaeffer's Trading Partners