Cree Shares Look Ready to Light Up

Oct. 14, 2010 6:34 AM ETWOLF, RBCN, VECO, AIXXF, GE, HD24 Comments
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Clean Energy Intel

In a blog I put out ahead of the Intel (INTC) numbers, I noted that reasonable guidance from Intel would help stabilize sentiment on the PC market and by extension help the LED market find new, more positive direction.

Though this is only part of the story for LEDs, this appears to have been the case. Veeco (VECO) and Aixtron (AIXG) are finding some clear demand, though Rubicon (OTC:RBCN) still appears weak. My own opinion is that the recent negative sentiment on Rubicon is likely to prove to have been misplaced. However, the focus of my attention is Cree (CREE). I think it worthwhile to restate the merits of this leader in the coming lighting revolution. CREE is some 30% off its highs since May but the price action is now suggesting that it is stabilizing and due for a comeback.

Energy efficient LED lighting is a solid opportunity for Sustainable Investing. CREE does produce LEDs for other uses – and has recently therefore been caught up in the generally confused concern over excess supply in the sapphire wafer and general LED backlighting market. However, CREE’s core market is clearly energy efficient LED lighting and this dominates its earnings outlook.

Hopefully, the stabilization of sentiment on LED stocks alone will now help investors to focus on the very compelling story for CREE in LED lighting. The benefits of LED lighting for energy efficiency and CO2 emissions are clear – with savings averaging somewhere around at least 68% when replacing old incandescent light bulbs for LED lighting – and as high as 85% for the best CREE product.

Moreover, consumer adoption looks ready to steadily increase –

  • The regulatory framework in the U.S. means that incandescent bulbs will be banned in phases, starting with the 100w bulb in 2012 and ending with the

This article was written by

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Psi Alpha - Insight and Intuition on Sustainable Investing. Psi Alpha has a PhD in Economics and retired from the Hedge Fund industry five years ago. He has a particular interest in the basic concepts of Sustainable Investing - with a focus on investing in technologies which address the issues of global water, climate change and the over-reliance of western economies on oil from sources lacking clear stability.

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