U.S. Markets closed

Ahead of the Bell: Cree shares rise after earnings

NEW YORK (AP) -- Shares of Cree Inc. rose in premarket trading Wednesday after the maker of LED products turned in better-than-expected quarterly results and gave an upbeat forecast.

Its shares were up $4.73, or 14.1 percent, to $38.20 ahead of Wednesday's opening bell.

On Tuesday, the company announced that net income in the fiscal second quarter, which ended Dec. 30, rose to $20.4 million, or 18 cents per share, from $12.1 million, or 10 cents per share, a year earlier. Revenue rose 14 percent to $346.3 million.

Both beat forecasts. Analysts surveyed by FactSet were expecting earnings of 29 cents per share on $331.5 million in revenue.

The company forecast adjusted earnings of 30 cents to 35 cents per share on revenue of $325 million to $345 million for the fiscal third quarter, which runs through March 31. Analysts were expecting 28 cents per share on $323 million in revenue.

Sterne Agee and Susquehanna International Group raised their earnings forecasts for the company.

Susquehqanna analyst Mehdi Hosseini said there was still excess capacity in the LED chip-manufacturing industry, but new products and factory cost-control steps were boosting Cree.