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Local Tech Wire

RESEARCH TRIANGLE PARK, N.C. – Another Wall Street analyst has embraced Cree.

JMP Securities launched coverage of the light emitting diode maker Tuesday with an "outperform" rating. Cree also launched a new line of LEDs for mobile devices.

However, Cree shares dropped 2 percent, or $1.68, in early morning trading. Shares had been up 37 cents, or about half a percent, at $78 in pre-market action.

By day’s end, Cree rallied to close at $77.07, off 56 cents or less than 1 percent.

An analyst upgrade and an accompanying sharply higher stock price target triggered a buying spree for (Nasdaq: CREE) shares on Monday.

UBS lifted the Durham-based company to “Buy” and raised its target price for the stock to $92 from $60.

UBS analyst Ahmar Zaman upgraded Cree based on a visit he made to the Far East.

“Our checks in Asia suggest the bear case of competitive pressure on Cree likely takes longer to develop,” he wrote, according to Barron’s blogger Eric Savitz.

“We note that many LED chip makers in Korea, Taiwan and Japan continue to out-source high-power LEDs from Cree, as their in-house yields on lighting-class LEDs are not sufficiently high.”

The news about the semiconductor and light emitting diode maker sent Cree shares soaring to $77.07, up nearly 10 percent from its opening at $70.60. That peak price not only set a new 52-week high but also was the highest price for Cree since July 2000, according to Bloomberg.

Shares later fell back to $76.61 but rallied again at 3 p.m. to $76.87, up almost 9 percent on the day.

Cree ended the day at $77.63, up $7.03‎ or 9.7 percent.

More than 6.2 million shares were traded.

More than 5 million shares had traded by 3 p.m., double the average daily volume.

Cree is capitalizing on rising demand for LEDs as an alternative to traditional lighting sources and is expanding its U.S. and China production capacity.