Tech Explained: A Look At Credo Technology Group (CRDO) Valuation As AI Connectivity Demand And Analyst Praise Build in Simple Terms

Credo Technology Group Holding (CRDO) is back in the spotlight as investor interest in AI focused semiconductors and data center infrastructure converges with fresh analyst attention and the company’s appearance at Needham’s Growth Conference.

See our latest analysis for Credo Technology Group Holding.

Recent trading has been choppy, with a 1 day share price return of 4.92% decline from US$149.12. This contrasts with a solid 7 day and 30 day share price return. The 1 year total shareholder return of 97.25% and very large 3 year total shareholder return suggest momentum has been strong over a longer stretch as investors react to earnings updates, AI infrastructure headlines, and Credo’s conference appearances.

If AI connectivity stories like Credo’s have your attention, this could be a good moment to scan other high growth tech and chip names through high growth tech and AI stocks.

With Credo posting 27.21% annual revenue growth, 30.67% annual net income growth, and a 1 year total return of 97.25%, along with a 1 day pullback and a large 3 year gain, is there still a sensible entry point here or is the market already baking in years of future growth?

Most Popular Narrative: 30.4% Undervalued

Compared with Credo Technology Group Holding’s last close of US$149.12, the most followed narrative points to a fair value of about US$214, built on detailed growth and profitability projections.

The fair value estimate has risen meaningfully to about $214 from roughly $163, reflecting stronger growth and margin assumptions. The future P/E has declined to about 72.7 times from roughly 81.1 times, suggesting a slightly lower multiple despite higher earnings growth expectations.

Read the complete narrative.

Curious how stronger revenue expansion, rising margins, and a still premium future earnings multiple all fit together into one valuation story? The full narrative lays out those moving parts and the assumptions sitting underneath them.

Result: Fair Value of $214.27 (UNDERVALUED)

Have a read of the narrative in full and understand what’s behind the forecasts.

However, two factors could quickly challenge this underpriced story: any slowdown in hyperscaler spending given customer concentration, and rising competition that pressures margins and P/E assumptions.

Find out about the key risks to this Credo Technology Group Holding narrative.

Another Angle On Valuation

Those fair value narratives point to upside, but the plain P/E math tells a tougher story. At about 127x earnings, Credo trades well above peers at 67.1x and beyond the 74.8x fair ratio. That gap suggests real valuation risk if expectations or sentiment cool. The question is which signal appears more informative.

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Credo Technology Group Holding Narrative

If you look at these numbers and come to a different conclusion, or simply prefer to test your own assumptions, you can build a custom view in just a few minutes with Do it your way.

A great starting point for your Credo Technology Group Holding research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If you stop with just one stock, you could miss other opportunities that fit your goals, so take a few minutes to scan a broader set of ideas today.

This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.

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