For Bears, CREE F3Q11 Was a "Dream Come True"

For the bears, Cree Inc.'s (NASDAQ: CREE) F3Q11 was a “dream come true: demand was weak; price was even weaker; revenue missed; margins plummeted; and inventory soared,” Oppenheimer reports.

“Exiting 3Q11, a broad (if tepid) uptick in post-Chinese New Year demand and a sequential improvement in bookings suggest Cree's nightmare may be drawing to a close,” Oppenheimer writes.

“But with backlog and visibility still low, we recognize it's difficult to have great confidence in the durability and slope of a near-term recovery—especially with record-high inventories potentially weighing on margins through calendar 2011. We've likely found the bottom, but not yet the bounce. We remain optimistic long term, but expect Cree to be range-bound near term.”

Cree closed Tuesday at $40.81.