Credo Technology Group (NASDAQ:CRDO) Shares Down 4.9% - Time to Sell?

Key Points

• Credo shares fell 4.9% to $169.70 amid profit-taking and valuation concerns; its high P/E ratio of 60.39 and beta of 3.25 indicate elevated volatility.
• The company’s fundamentals remain strong, with quarterly revenue rising 114.7% year over year to $479 million and EPS of $1.20, beating analysts’ estimates. Management also projects near-term revenue of approximately $525 million to $535 million.
• Analyst sentiment remains favorable but mixed: Credo has a consensus “Moderate Buy” rating and an average price target of $262.67, while some analysts have recently reduced targets and insider selling may weigh on investor sentiment.

Credo Technology Group Holding Ltd. (NASDAQ:CRDO - Get Free Report) shares dropped 4.9% during mid-day trading on Friday. The stock traded as low as $168.56 and last traded at $169.70. Approximately 6,190,615 shares traded hands during trading, a decline of 18% from the average session volume of 7,589,259 shares. The stock had previously closed at $178.50.

More Credo Technology Group News

Here are the key news stories impacting Credo Technology Group this week:

• Positive Sentiment: Credo launched a new optical connectivity standards group focused on advancing interoperability for AI data-center networks. Establishing industry standards could strengthen Credo’s influence and support longer-term adoption of its optical products. Credo starts optical connectivity standards group
• Positive Sentiment: Recent coverage highlights Credo’s role in solving the high-speed interconnect and reliability challenges limiting large AI clusters. Its active electrical and optical cables, SerDes technology and other connectivity products could benefit as hyperscalers expand AI infrastructure. Credo AI connectivity opportunity
• Positive Sentiment: Analysts and financial commentary continue to point to exceptional growth: the latest quarter produced $479 million in revenue, up 114.7% year over year, while management’s outlook calls for approximately $525 million to $535 million in near-term revenue and more than 85% fiscal 2027 growth. Credo AI data-center growth
• Neutral Sentiment: Rosenblatt reaffirmed a “Neutral” rating but raised its price target to $235, implying substantial upside from recent levels. The broader analyst consensus remains “Moderate Buy,” although target reductions and concerns about customer concentration temper the optimism. Credo analyst targets
• Negative Sentiment: The recent decline appears driven primarily by sector-wide profit-taking and concern that Credo’s valuation leaves little room for execution disappointments. With a high earnings multiple and elevated volatility, investors are reassessing the stock even though results remain strong. Credo valuation and selloff analysis
• Negative Sentiment: Insiders have reported sales, including CTO Chi Cheng’s sale of 31,290 shares and director Pantas Sutardja’s sale of 1,540 shares. The transactions were made under pre-arranged Rule 10b5-1 plans and represent small portions of their remaining holdings, but they may still weigh on sentiment. Credo insider selling

Analysts Set New Price Targets

CRDO has been the subject of several research reports. Rosenblatt Securities reaffirmed a "neutral" rating and set a $235.00 price objective on shares of Credo Technology Group in a research note on Thursday. Barclays upped their price objective on shares of Credo Technology Group from $260.00 to $300.00 and gave the company an "overweight" rating in a report on Monday, July 20th. Mizuho dropped their price target on shares of Credo Technology Group from $290.00 to $245.00 and set an "outperform" rating for the company in a research note on Monday, September 21st. Bank of America lowered their price objective on Credo Technology Group from $340.00 to $275.00 and set a "buy" rating for the company in a research report on Wednesday, September 2nd. Finally, Zacks Research downgraded Credo Technology Group from a "strong-buy" rating to a "hold" rating in a research report on Monday, August 3rd. One investment analyst has rated the stock with a Strong Buy rating, fourteen have given a Buy rating and three have given a Hold rating to the company. According to data from MarketBeat.com, Credo Technology Group has a consensus rating of "Moderate Buy" and an average target price of $262.67.

Credo Technology Group Trading Down 4.9%

The company has a market capitalization of $31.90 billion, a PE ratio of 60.39, a PEG ratio of 0.71 and a beta of 3.25. The business has a fifty day moving average of $206.04 and a 200 day moving average of $205.07.

Credo Technology Group (NASDAQ:CRDO - Get Free Report) last posted its quarterly earnings data on Tuesday, September 1st. The company reported $1.20 EPS for the quarter, beating the consensus estimate of $1.17 by $0.03. The business had revenue of $479.00 million during the quarter, compared to analyst estimates of $473.30 million. Credo Technology Group had a net margin of 33.83% and a return on equity of 28.77%. The business's revenue for the quarter was up 114.7% compared to the same quarter last year. During the same quarter last year, the firm posted $0.52 earnings per share. Equities analysts forecast that Credo Technology Group Holding Ltd. will post 5.02 EPS for the current fiscal year.

Insider Transactions at Credo Technology Group

In other Credo Technology Group news, CTO Chi Cheng sold 27,500 shares of Credo Technology Group stock in a transaction that occurred on Wednesday, September 23rd. The stock was sold at an average price of $193.12, for a total value of $5,310,800.00. Following the transaction, the chief technology officer directly owned 5,689,897 shares in the company, valued at approximately $1,098,832,908.64. This trade represents a 0.48% decrease in their position. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, COO Yat Lam sold 55,441 shares of the stock in a transaction that occurred on Friday, July 31st. The stock was sold at an average price of $213.02, for a total value of $11,810,041.82. Following the transaction, the chief operating officer directly owned 2,529,169 shares of the company's stock, valued at approximately $538,763,580.38. This trade represents a 2.15% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders have sold 468,786 shares of company stock worth $95,025,003. Corporate insiders own 9.06% of the company's stock.

Hedge Funds Weigh In On Credo Technology Group

Several hedge funds have recently bought and sold shares of CRDO. Bank of America Corp DE lifted its holdings in shares of Credo Technology Group by 13.7% in the second quarter. Bank of America Corp DE now owns 2,182,764 shares of the company's stock valued at $593,603,000 after purchasing an additional 262,479 shares in the last quarter. Corient Private Wealth LLC grew its holdings in Credo Technology Group by 239,024.5% in the fourth quarter. Corient Private Wealth LLC now owns 3,598,823 shares of the company's stock valued at $517,835,000 after purchasing an additional 3,597,318 shares during the period. Atreides Management LP raised its position in shares of Credo Technology Group by 3.5% in the 2nd quarter. Atreides Management LP now owns 1,129,285 shares of the company's stock worth $307,109,000 after buying an additional 38,052 shares during the period. The Manufacturers Life Insurance Company increased its position in Credo Technology Group by 192.1% during the 1st quarter. The Manufacturers Life Insurance Company now owns 1,047,084 shares of the company's stock worth $98,290,000 after purchasing an additional 688,596 shares in the last quarter. Finally, Value Aligned Research Advisors LLC acquired a new position in Credo Technology Group during the second quarter valued at approximately $91,919,000. 80.46% of the stock is owned by hedge funds and other institutional investors.

About Credo Technology Group

Credo Technology Group Holding Ltd. develops high-speed connectivity solutions for data infrastructure. Its technologies are designed to improve the performance, power efficiency and reliability of connections used in cloud computing, artificial intelligence, high-performance computing, telecommunications and enterprise networks.

The company's product portfolio includes serializer/deserializer (SerDes) intellectual property, integrated circuits, active electrical cables and optical connectivity products.

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