Key Stats for Credo Technology Stock
- YTD Price change for Credo Technology stock Today: -28%
- $CRDO Share Price as of Mar. 04: $103
- 52-Week High: $214
- $CRDO Stock Price Target: $208
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What Happened?
Credo Technology (CRDO) stock dropped 14% on Tuesday despite posting record Q3 results that beat expectations.
- The semiconductor company reported revenue of $407 million, up 52% from the prior quarter and more than tripling year-over-year.
- Non-GAAP gross margins came in strong at 68.6%, and the company generated $209 million in net income.
- The selloff came as investors worried about the shift from copper-based Active Electrical Cables (AECs) to optical connectivity in AI data centers.
Bank of America maintained its “buy” rating on Credo Technology stock but lowered its price target to $160 from $200, still implying nearly 40% upside from current levels.
CEO Bill Brennan pushed back against concerns during the earnings call, emphasizing that copper and optical solutions are complementary rather than competitive.
“Where you can use copper, you will use copper,” Brennan said, noting that AECs offer superior reliability and power efficiency for connections up to 7 meters.
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What the Market Is Telling Us About Credo Technology Stock
The sharp decline in Credo Technology stock suggests investors are pricing in potential risk to the company’s core AEC business as the industry shifts toward optical solutions.
However, Bank of America analyst Vivek Arya sees the company well-positioned for this transition, noting that Credo is expanding into optical connectivity with its ZeroFlap Optics product line, which began production shipments this quarter.
The company guided for continued strong growth, expecting revenue between $425 million and $435 million in Q4 and more than 50% year-over-year growth in fiscal 2027.
Management highlighted that ZeroFlap Optics will see a significant production ramp starting in the first quarter of fiscal 2027.
With robust fundamentals and analyst price targets suggesting substantial upside, today’s weakness in Credo Technology stock may represent a buying opportunity for investors with a longer-term view.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
