Electronic Industry Weekly Report: CREE's performance is impressive, its stock price has reached a new high, and the LED industry has strong demand
Release time:
2023-03-29
Source:
Last week, the Shenwan Electronics Industry Index fell by -3.39%, while the Shanghai Composite Index rose by 0.79%. Last Friday, the ChiNext board index experienced a significant adjustment, with electronic stocks being more prominent on the ChiNext board. As a result, the electronics industry underwent an adjustment on Friday. However, we believe that although the current industry valuation level is high and it is difficult to see systematic opportunities, the inventory level of intelligent machines in mainland China has effectively decreased, and the overall market has shown signs of recovery. From the current order visibility observation, the peak season atmosphere can be felt in August, The mainland mobile phone market is expected to gradually improve. Moreover, Apple is about to launch low-priced smartphones, although it means intensified competition in the mid to low-end smartphone market. However, for the relevant Apple supply chain, it means the emergence of new incremental markets, which is conducive to an increase in component shipments.
Last week, an important event in the industry was Cree's stock price reaching a new high. The company's revenue from April to June 2013 increased by 22% annually (7% quarterly) to $375 million. From April to June, the revenue of LED products and lighting products increased by 17% and 33% respectively, accounting for 58% and 36% of revenue respectively; The gross profit margin is 38.2%. Cree rose 1.35% in normal trading on the 13th, closing at $75.76, reaching a new closing high since May 13, 2010; After hours, it plummeted 16.04% to $63.61. The stock price has risen by 122.95% so far this year.
Investment Strategy Outlook
Maintaining the previous view, the adjustment pressure brought by the inventory adjustment of smartphones in the third quarter to electronic stocks is more of a short-term disturbance, and currently the inventory adjustment is gradually coming to an end, and the growth trend of domestic smartphones is still positive. We believe that in the long run, despite signs of saturation in high-end smartphones, for Chinese smartphone manufacturers, in addition to the domestic market, there is still huge growth space in overseas Asia, Africa, and Latin America. Therefore, the domestic smartphone industry is still in a growth period, and the supply chain is still valued. We still recommend that investors focus on companies that have actively practiced internal skills in the past two years and have explosive growth opportunities next year, such as Xinwangda and Lixun Precision.
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