Morgan Stanley Underweight On Cree

Morgan Stanley is out with a research report on Cree CREE and it has an Underweight rating on shares. In a note to clients, Morgan Stanley writes, "Cree beat in a tough environment as sales of its own light fixtures grew faster than we anticipated. Cree's product quality appears to be winning and offering pricing power that competitors do not enjoy. Despite the relative strength, gross margins fell 400bps q/q to 38% (now down 1100bps in a year) and management guided for flat margins and flat-to-down EPS of $025–0.28 next quarter. EPS of $0.28 was above cons of $0.26 and MSe of $0.24." Shares of CREE shares are up $3.01 in pre-market trading to $32.50, a gain of 10.2%.