Credo Technology Group (NASDAQ:CRDO) Shares Gap Down on Insider Selling

Key Points

• Credo Technology Group shares fell sharply, opening at $151.24 versus a prior close of $162.77 and later trading near $147.79, following disclosed insider sales.
• CTO Chi Cheng sold 27,500 shares for approximately $4.75 million, while CEO William Brennan sold 16,666 shares for about $2.91 million. Both transactions were conducted under pre-arranged Rule 10b5-1 trading plans.
• Despite the selloff, analysts maintain a “Moderate Buy” consensus with an average price target of $262.67; the company also reported 114.7% year-over-year quarterly revenue growth and earnings above expectations.

Shares of Credo Technology Group Holding Ltd. (NASDAQ:CRDO - Get Free Report) gapped down before the market opened on Friday following insider selling activity. The stock had previously closed at $162.77, but opened at $151.24. Credo Technology Group shares last traded at $147.7870, with a volume of 3,645,576 shares.

Specifically, CTO Chi Cheng sold 27,500 shares of Credo Technology Group stock in a transaction on Tuesday, October 20th. The shares were sold at an average price of $172.62, for a total transaction of $4,747,050.00. Following the transaction, the chief technology officer directly owned 5,579,897 shares of the company's stock, valued at $963,201,820.14. This trade represents a 0.49% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO William Brennan sold 16,666 shares of the company's stock in a transaction on Monday, October 19th. The shares were sold at an average price of $174.87, for a total transaction of $2,914,383.42. Following the completion of the sale, the chief executive officer owned 1,584,164 shares of the company's stock, valued at approximately $277,022,758.68. This represents a 1.04% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.

Wall Street Analyst Weigh In

CRDO has been the topic of several research analyst reports. Stifel Nicolaus dropped their price objective on Credo Technology Group from $350.00 to $310.00 and set a "buy" rating on the stock in a research note on Monday, October 5th. Mizuho decreased their target price on 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. Wall Street Zen downgraded Credo Technology Group from a "buy" rating to a "hold" rating in a report on Saturday, August 1st. TD Cowen raised their price target on Credo Technology Group from $260.00 to $300.00 and gave the stock a "buy" rating in a research report on Tuesday, August 18th. Finally, Weiss Ratings cut Credo Technology Group from a "hold (c+)" rating to a "hold (c)" rating in a report on Tuesday, October 6th. One equities research analyst has rated the stock with a Strong Buy rating, fourteen have issued a Buy rating and three have given a Hold rating to the company's stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and a consensus price target of $262.67.

Credo Technology Group Price Performance

The company has a market capitalization of $27.95 billion, a price-to-earnings ratio of 52.69, a PEG ratio of 0.73 and a beta of 3.25. The firm has a 50-day moving average price of $197.79 and a two-hundred day moving average price of $207.74.

Credo Technology Group (NASDAQ:CRDO - Get Free Report) last issued its quarterly earnings results on Tuesday, September 1st. The company reported $1.20 earnings per share for the quarter, topping the consensus estimate of $1.17 by $0.03. The company had revenue of $479.00 million during the quarter, compared to analysts' expectations 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 quarterly revenue was up 114.7% on a year-over-year basis. During the same period last year, the business earned $0.52 EPS. On average, equities analysts predict that Credo Technology Group Holding Ltd. will post 5.02 EPS for the current year.

Institutional Trading of Credo Technology Group

Institutional investors and hedge funds have recently bought and sold shares of the stock. Bank of America Corp DE lifted its stake in Credo Technology Group by 13.7% in the 2nd 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 during the last quarter. Atreides Management LP grew its stake in shares of Credo Technology Group by 3.5% in the second quarter. Atreides Management LP now owns 1,129,285 shares of the company's stock valued at $307,109,000 after acquiring an additional 38,052 shares in the last quarter. The Manufacturers Life Insurance Company increased its holdings in shares of Credo Technology Group by 192.1% during the first 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 during the period. H&H International Investment LLC increased its stake in Credo Technology Group by 431.6% during the 1st quarter. H&H International Investment LLC now owns 751,200 shares of the company's stock worth $70,515,000 after acquiring an additional 609,900 shares during the period. Finally, Dimensional Fund Advisors LP increased its stake in Credo Technology Group by 0.5% during the 1st quarter. Dimensional Fund Advisors LP now owns 703,122 shares of the company's stock worth $65,949,000 after acquiring an additional 3,501 shares during the period. Institutional investors own 80.46% of the company's stock.

About Credo Technology Group

Credo Technology Group Holding Ltd. is a fabless semiconductor and connectivity solutions company that develops high-speed data-infrastructure technologies. Its products are designed to help data centers and communications networks move large volumes of information with lower power consumption and improved signal integrity.

The company's portfolio includes serializer/deserializer (SerDes) intellectual property, application-specific integrated circuits, active electrical cables, optical digital signal processors and related connectivity platforms.

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