UPDATE: Wedbush Securities Initiates Cree at Buy on Gross Margin Outlook

Wedbush Securities initiated coverage on Cree

with an Outperform and a $36 price target. Wedbush Securities noted, "We see Cree as optimally positioned to benefit from broader growth in LED lighting fixtures, given the company's leadership in developing high-brightness LED components and vertical integration with fixtures production. Gross margins appear to have finally bottomed and 2Q13 is positioned to be Cree's fourth straight quarter of improving margins. The outlook for improving 2H13 profitability from the recently introduced C 3 chip platform and the potential for increasing fab utilization in FY14 rising on both internal and external demand growth suggest margins have good prospects for further expansion. We would be buyers at current levels." Cree closed at $31.46 on Wednesday.