Credo Technology Group Holding Ltd. (CRDO)
NASDAQ:CRDO
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Credo Technology Group Holding Ltd
(NASDAQ:CRDO)
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Rating:83Outperform
Price Target:
$275.00
▲(71.14% Upside)
Action:Reiterated
Date:06/02/26
The score is driven primarily by materially improved financial performance (high margins, strong cash generation, and very low leverage) and reinforced by bullish technical momentum. This is partially offset by a stretched valuation (high P/E, no dividend) and execution risks emphasized on the earnings call (customer concentration/lumpiness and ramp timing/supply constraints).
Positive Factors
High and improving margins
Sustained industry-leading gross and net margins indicate durable product differentiation and pricing power in high-speed connectivity. High margins support reinvestment, buffer cyclicality in hardware cycles, and enable rapid scaling of profitability as revenue ramps from optics and new product lines.
Negative Factors
Customer concentration and revenue lumpiness
Heavy dependence on a few large customers concentrates execution and demand risk: single-customer shipment timing or design-cycle changes can create quarter-to-quarter volatility. Over the medium term this limits revenue predictability and increases negotiation leverage of major buyers.
Read all positive and negative factors
Positive Factors
Negative Factors
High and improving margins
Sustained industry-leading gross and net margins indicate durable product differentiation and pricing power in high-speed connectivity. High margins support reinvestment, buffer cyclicality in hardware cycles, and enable rapid scaling of profitability as revenue ramps from optics and new product lines.
Read all positive factors
Credo Technology Group Holding Ltd (CRDO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$46.26B
Dividend YieldN/A
Average Volume (3M)8.35M
Price to Earnings (P/E)98.1
Beta (1Y)3.54
Revenue Growth205.68%
EPS Growth755.03%
CountryUS
Employees500
SectorTechnology
Sector Strength88
IndustryCommunication Equipment
Share Statistics
EPS (TTM)1.91
Shares Outstanding184,449,940
10 Day Avg. Volume12,199,569
30 Day Avg. Volume8,346,283
Financial Highlights & Ratios
PEG Ratio-0.51
Price to Book (P/B)10.58
Price to Sales (P/S)16.51
P/FCF Ratio248.47
Enterprise Value/Market Cap0.91
Enterprise Value/Revenue39.63
Enterprise Value/Gross Profit58.43
Enterprise Value/Ebitda113.94
Forecast
1Y Price Target
$258.07Price Target Upside60.60% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering15
EPS Forecast (FY)5.98
Revenue Forecast (FY)$2.39B
Credo Technology Group Holding Ltd Business Overview & Revenue Model
Company Description
Credo Technology Group Holding Ltd (CRDO) specializes in delivering advanced high-speed connectivity solutions for both optical and electrical Ethernet applications. Its operational reach extends globally, encompassing the United States, Mexico, M...
How the Company Makes Money
Credo primarily makes money by selling semiconductor connectivity products and by licensing semiconductor intellectual property used in high-speed data links. A key revenue stream is product revenue from the sale of its connectivity chips/componen...
Credo Technology Group Holding Ltd Earnings Call Summary
Earnings Call Date:Jun 01, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Sep 09, 2026
Earnings Call Sentiment Positive
The call conveyed very strong operational and financial momentum: record revenue, large double- and triple-digit year-over-year growth, industry-leading margins, robust cash generation, and an aggressive product and optics roadmap (including the Dust Photonics acquisition). Management provided confident guidance for continued revenue growth (>80% YoY for FY27) and outlined a clear back-half inflection driven by optics while acknowledging execution and timing risks (customer lumpiness, supply-chain/process-node capacity, tariff uncertainty) and near-term elevated R&D/opex. On balance the positives (scale, margin expansion, product and M&A momentum, strong cash) substantially outweigh the cited risks.Positive Updates
Record Fiscal 2026 Revenue and Rapid Growth
Revenue for fiscal 2026 exceeded $1.3 billion, up 206% year over year, with non-GAAP net income of $662 million (more than 5x year over year). EPS was $3.46 for the year, a $2.76 improvement or +392% versus prior year.
Negative Updates
Customer Concentration and Lumpiness
Top four end customers each represented ≥10% of Q4 revenue; the largest customer was 34%, second 27%, third 16% and a fourth at 10%. Management acknowledged quarter-to-quarter variability and lumpiness in customer shipments.
Read all updates
Q4-2026 Updates
Positive
Negative
Record Fiscal 2026 Revenue and Rapid Growth
Revenue for fiscal 2026 exceeded $1.3 billion, up 206% year over year, with non-GAAP net income of $662 million (more than 5x year over year). EPS was $3.46 for the year, a $2.76 improvement or +392% versus prior year.
Read all positive updates
Company Guidance
Management guided Q1 FY2027 revenue of $465–475 million, non‑GAAP gross margin of 67–69%, non‑GAAP operating expenses of $86–90 million and diluted weighted‑average shares of ~199 million; for fiscal 2027 they expect >80% YoY revenue growth, mid‑single‑digit sequential growth in H1 with an inflection in H2, non‑GAAP gross margin broadly consistent with FY26 (68.1%), non‑GAAP operating expenses up ~50% YoY (well below revenue growth) and non‑GAAP net margin around 50%. They forecast the optical portfolio to drive much of the back‑half inflection, with ZeroFlap optics, silicon‑photonic PICs and optical DSPs each contributing >$100 million (> $600 million total) and roughly half of FY27 absolute dollar growth coming from optics versus copper (AECs/retimers). For context, FY26 revenue was $1.3 billion with 68.1% gross margin and $662 million non‑GAAP net income, Q4 revenue was a record $437 million with 68.3% non‑GAAP gross margin, Q4 non‑GAAP net income $226.7 million (51.9% net margin), Q4 operating expenses $81.7 million, Q4 cash from operations $182.2 million, CapEx $4.8 million and ending cash ~$1.4 billion.Credo Technology Group Holding Ltd Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
92
Very Positive
Cash Flow
84
Very Positive
| Breakdown | TTM | Apr 2025 | Apr 2024 | Apr 2023 | Apr 2022 | Apr 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.07B | 436.77M | 192.97M | 184.19M | 106.48M | 58.70M |
| Gross Profit | 724.47M | 282.91M | 119.43M | 106.19M | 64.02M | 38.28M |
| EBITDA | 371.50M | 76.81M | -22.52M | -9.31M | -14.04M | -23.02M |
| Net Income | 339.76M | 52.18M | -28.37M | -16.55M | -22.18M | -27.51M |
Balance Sheet | ||||||
| Total Assets | 2.04B | 809.26M | 601.93M | 397.29M | 375.69M | 155.49M |
| Cash, Cash Equivalents and Short-Term Investments | 1.30B | 431.34M | 410.00M | 217.81M | 259.32M | 103.76M |
| Total Debt | 16.28M | 16.04M | 13.87M | 15.50M | 17.19M | 0.00 |
| Total Liabilities | 188.45M | 127.67M | 61.73M | 49.65M | 41.53M | 210.92M |
| Stockholders Equity | 1.85B | 681.58M | 540.20M | 347.63M | 334.16M | -55.43M |
Cash Flow | ||||||
| Free Cash Flow | 283.69M | 29.02M | 17.09M | -46.33M | -48.41M | -48.42M |
| Operating Cash Flow | 339.87M | 65.08M | 32.74M | -24.61M | -30.83M | -42.36M |
| Investing Cash Flow | -139.74M | 111.99M | -249.49M | -130.94M | -17.58M | -6.06M |
| Financing Cash Flow | 720.99M | -7.73M | 175.28M | 4.88M | 204.18M | 77.89M |
Credo Technology Group Holding Ltd Technical Analysis
Positive
160.69
Price Trends
185.35
Positive
150.11
Positive
151.02
Positive
Market Momentum
17.57
Negative
63.85
Neutral
76.25
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CRDO, the sentiment is Positive. The current price of 160.69 is below the 20-day moving average (MA) of 214.87, below the 50-day MA of 185.35, and above the 200-day MA of 151.02, indicating a bullish trend. The MACD of 17.57 indicates Negative momentum. The RSI at 63.85 is Neutral, neither overbought nor oversold. The STOCH value of 76.25 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CRDO.
Credo Technology Group Holding Ltd Risk Analysis
Credo Technology Group Holding Ltd disclosed 65 risk factors in its most recent earnings report. Credo Technology Group Holding Ltd reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Credo Technology Group Holding Ltd Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
83 Outperform | $46.26B | 98.08 | 29.56% | ― | 205.68% | 755.03% | |
72 Outperform | $41.43B | 15.44 | 25.11% | 2.51% | 4.40% | 1595.74% | |
71 Outperform | $83.93B | 70.29 | 5.06% | 2.26% | 12.83% | 9.07% | |
68 Neutral | $63.13B | 144.44 | 8.26% | ― | 30.59% | 323.23% | |
62 Neutral | $35.63B | 37.82 | 101.45% | 0.49% | 33.34% | 71.52% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
CRDO
Credo Technology Group Holding Ltd
250.81
171.64
216.80%
CIEN
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445.98
372.22
504.64%
ERIC
Telefonaktiebolaget LM Ericsson
12.28
4.01
48.42%
NOK
Nokia
14.80
9.60
184.67%
UI
Ubiquiti Networks
588.73
211.19
55.94%
Credo Technology Group Holding Ltd Corporate Events
Business Operations and StrategyM&A Transactions
Credo Technology Announces Acquisition of DustPhotonics to Expand Optics
Positive
Apr 13, 2026
On April 13, 2026, Credo Technology Group Holding Ltd and its subsidiary Credo Semiconductor, Inc. signed a share purchase agreement to acquire 100% of Israeli company DustPhotonics Ltd., paying $750 million in cash plus approximately 0.92 million...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.