Stocks-in-depth

We described in Part 1 how Cree, Inc. ramped up its headcount in its LED fabrication operation during the major up-cycle that occurred from 2006 through 2010.  Although fewer bodies have been added since then, there's "only" been a 10% reduction in corporate headcount since the all-time peak in fiscal 2014, and LED sales are now back to where they were before fiscal 2010. Although Cree has changed course to emphasize lighting fixtures, the company still suffers from low gross margins and excessive operating expense relative to sales.  It also pays out a generous stock comp package even though its stock has underperformed Acuity, a pure-LED comparable that has treated its shareholders to the above average returns one might expect when being a leader in such a rapidly growing category. In this podcast, we recap the operations discussion from part 1 (including thoughts about how our model has been changing over time), document how well the rest of the industry is doing, talk about the nature of excess Chinese ca