Credo Technology Group (CRDO) Stock: 7% Pullback, Fresh Institutional Buying and New Price Targets on December 11, 2025

Date: December 11, 2025

Key takeaways

CRDO is trading around the mid‑$150s after a sharp 7% slide on Wednesday, following a year in which the stock has surged more than 160%. ^[1]
Q2 FY2026 results showed hypergrowth: revenue up 272% year over year, GAAP EPS turning strongly positive, and operating cash flow up more than fourfold, driven by AI data‑center demand. ^[2]
Analysts remain overwhelmingly bullish with a “Strong Buy” consensus and average 12‑month targets between roughly $180 and $220, even as some valuation models flag the stock as overvalued. ^[3]
Institutional flows are mixed: new positions from Rokos Capital Management and AXA sit alongside trimming by Federated Hermes and earlier profit‑taking by other funds. ^[4]
Management is pitching a multi‑year AI connectivity roadmap (AECs, new Active Linear Cables, and “ZeroFlap” optics) that targets 100–200G per‑lane speeds and a long‑term path from roughly $1 billion to potentially $5 billion+ in annual revenue. ^[5]

CRDO stock today: volatility after a huge AI‑driven run

In Thursday’s session, Credo Technology Group Holding Ltd (NASDAQ: CRDO) is trading around $154–$158 per share, with real‑time data showing a last trade near $154.50, down about 2% on the day. The company’s market capitalization sits around $32.5 billion, with a trailing price‑to‑earnings ratio north of 150 and earnings per share of $1.16.

The weakness follows a sharp 7.47% drop on Wednesday, when CRDO fell from $170.29 to $157.57 in highly volatile trading, with an intraday range between $155.50 and $169.64. An AInvest note framed the move as the stock’s worst single‑day slide since its IPO, describing a tug‑of‑war between bullish analyst targets and concerns that the shares had become about 4.5% overvalued at $170.29. ^[6]

Even after this pullback, CRDO remains one of 2025’s standout AI beneficiaries. A Zacks earnings recap noted that the shares had gained roughly 164% year‑to‑date versus about 16% for the S&P 500, underscoring just how far expectations have run ahead of the broader market. ^[7]

High implied volatility—AInvest cites options with implied vol above 85%—and a 52‑week high around $213.80 point to a stock where sentiment can swing quickly as new information arrives. ^[8]

December 11, 2025: today’s key headlines around Credo stock

1. Big money rotates: Rokos and AXA buy, Federated trims

Fresh 13F‑style disclosures published on December 11 show contrasting institutional moves in CRDO:

Rokos Capital Management LLP disclosed a new position of 231,698 shares, worth about $21.45 million, representing roughly 0.13% of Credo’s outstanding stock. ^[9]
AXA S.A. reported acquiring 174,272 shares, also in the second quarter, adding another sizeable long‑term holder to the registry. ^[10]
By contrast, Federated Hermes Inc. reported that it had reduced its CRDO position, locking in gains after the stock’s steep climb. ^[11]

A recent Yahoo Finance breakdown estimated that around 73% of Credo’s shares are owned by institutional investors, and those holders collectively benefited from a 4.6% rise in the stock last week before the latest bout of volatility. ^[12]

Taken together, today’s filings tell a classic high‑growth story: some funds are entering or adding as the long‑term AI thesis strengthens, while others are harvesting profits and rebalancing exposure after a massive year.

2. Technical “washout” after AInvest’s sudden‑selloff analysis

On Wednesday, AInvest published a detailed piece titled “Credo Technology Plummets 7.47%: What’s Behind the Sudden Selloff?” that has circulated widely among traders. ^[13]

Key points from that note:

The article highlighted CRDO’s 7.47% one‑day decline to $157.57 and an intraday range of $155.50–$169.64, arguing the move reflected a “frenzy of speculation” and profit‑taking.
AInvest cited 11 analysts with an average price target near $220, implying about 29% upside from $170.29 at the time of the analysis, but contrasted this with a Zacks model suggesting 4.5% overvaluation at that same price. ^[14]
The piece emphasized a dynamic P/E near 97, a 200‑day moving average around $101, and implied volatility above 85% as signs of an unusually crowded, high‑risk trade.
Options activity around $150 strikes expiring December 2025 was used to illustrate how traders are hedging downside while keeping leverage to further upside moves. ^[15]

The conclusion: CRDO sits at a technical crossroads, with $155.50 flagged as a short‑term support level and a breakout above $160 cited as a potential trigger for renewed momentum.

3. Barclays conference: management leans into multi‑year AI roadmap

Credo’s leadership has been active on the conference circuit this week. The company’s investor‑relations site confirmed that CEO Bill Brennan and CFO Dan Fleming presented at Barclays’ 23rd Annual Global Technology Conference on December 10 at 2:30 p.m. PT, with a transcript published today by GuruFocus. ^[16]

While the Barclays transcript largely reiterates themes from the recent Q2 earnings call, it underscores several important strategic points:

High‑speed connectivity roadmap: Management described shipments across 25G, 50G and 100G per‑lane solutions, with 100G per‑lane cited as one of the fastest‑growing parts of the business and a migration path toward 200G per lane over the next two to three years. ^[17]
Product “pillars” and TAM expansion: Credo now frames its portfolio as a layered set of system‑level solutions—retimers for short (~0.5–1m) on‑board connections, Active Electrical Cables (AECs) up to ~7m, newly announced Active Linear Cables (ALCs) targeting up to ~30m, and ZeroFlap (ZF) optics for connections up to and beyond 1km inside the data center. ^[18]
Long‑term revenue ambition: Brennan characterized the recent quarter as “transformative from a news standpoint,” arguing that the expanding portfolio and broader customer base provide a plausible path to move from around $1 billion in annual revenue to $5 billion and beyond over the next several years. ^[19]
Margin outlook: CFO Dan Fleming reiterated a long‑term gross‑margin target of 63–65%, noting that current margins are above that range but are expected to normalize as additional products and costs scale up. ^[20]

For investors, the takeaway from today’s conference coverage is that Credo is positioning itself not as a single‑product chip vendor, but as a system‑level AI connectivity platform spanning copper and optical links inside hyperscale data centers.

Fundamentals: Q2 FY2026 earnings underpin the bull case

The recent volatility is happening against the backdrop of exceptionally strong fundamentals.

On December 1, Credo reported second‑quarter FY2026 results (quarter ended November 1, 2025) that significantly outpaced expectations: ^[21]

Revenue: $268.0 million
- +20.2% quarter‑over‑quarter (vs. $223.1 million in Q1 FY2026) ^[22]
- +272.1% year‑over‑year (vs. $72.0 million in the prior‑year quarter)
GAAP gross margin: 67.5%; non‑GAAP gross margin: 67.7%
GAAP net income: $82.6 million; GAAP diluted EPS: $0.44
Non‑GAAP net income: about $127.8 million; non‑GAAP EPS: $0.67
Operating cash flow: $54.2 million, up 426.7% year‑over‑year, reflecting stronger cash generation and working‑capital efficiency. ^[23]
Balance sheet: cash and short‑term investments of roughly $813.6 million and total assets of about $1.45 billion, with modest liabilities. ^[24]

The prior quarter was already strong: Q1 FY2026 revenue of $223.1 million represented 31% sequential growth and 274% year‑over‑year growth, with GAAP net income of $63.4 million and non‑GAAP net income of $98.3 million. ^[25]

Commentary from MLQ.ai attributes Credo’s explosive growth primarily to: ^[26]

Large‑scale AI infrastructure deployments by hyperscalers.
Rising demand for Active Electrical Cables (AECs) and high‑speed optical products.
Momentum in Ethernet and PCIe retimers designed for AI networking workloads.

Credo’s own filings describe its mission as “redefining high‑speed connectivity” for emerging 100G, 200G, 400G, 800G and 1.6T Ethernet ports, using proprietary SerDes and DSP technology to deliver lower power and cost per bit for AI, cloud and hyperscale networks. ^[27]

Wall Street’s view: strong growth, stretched valuation

Consensus price targets and earnings forecasts

StockAnalysis aggregates forecasts from 11 Wall Street analysts and currently shows: ^[28]

Consensus rating: Strong Buy
Average 12‑month price target:$179.91
- Implies roughly 16.9% upside from a reference price of $153.95 at Thursday’s open
Target range: low $84; high $250

On the fundamentals side, the same dataset projects:

FY2026 revenue: ~$991.6 million, up about 127% from $436.8 million in FY2025.
FY2027 revenue: ~$1.27 billion, up 28% from FY2026.
EPS this year:$2.12, up more than 600% from $0.29.
EPS next year:$2.66, a further ~25% increase.

That forecast implies high double‑digit growth continuing beyond the FY2026 inflection and a forward P/E multiple in the high‑50s to low‑70s, depending on where the share price settles.

A separate GuruFocus note, focused on Barclays’ December 2 target hike, highlights an average one‑year price target of $182.32 from 14 analysts, with a high of $240 and a low of $135, and an average brokerage recommendation of 1.8 on a 1–5 scale, corresponding to “Outperform.” ^[29]

At the same time, that article’s proprietary GF Value model estimates a one‑year “fair value” price of $119.26, implying about 30% downside from the then‑current $171.13 level—evidence that not all quantitative models agree with the market’s enthusiasm. ^[30]

Zacks: 29% upside but caution on targets

An analysis published by Nasdaq and authored by Zacks Equity Research on December 10 notes that CRDO’s average analyst target of $220—based on 11 short‑term price targets ranging from $165 to $250—implies a 29.2% upside from the prior close of $170.29. ^[31]

More importantly, Zacks points to:

A 31.1% increase in the consensus EPS estimate for the current year over the past 30 days.
A Zacks Rank #1 (Strong Buy) for CRDO, placing it in the top 5% of the stocks they monitor. ^[32]

However, Zacks also stresses that analysts’ price targets often skew optimistic and should not be used in isolation—a theme echoed by several more cautious research pieces.

Valuation pushback: Simply Wall St and others

A December 10 article from Simply Wall St describes Credo’s recent results and licensing deals as a “blowout AI‑driven quarter” with strong guidance, but concludes that the stock appears “4.5% overvalued” at $170.29, with a fair value estimate of $162.93. ^[33]

The piece highlights:

An extraordinary share‑price run since the IPO.
Dependency on continued AI infrastructure spending, particularly for 200G SerDes, PCIe Gen 6/7 and emerging 1.6T solutions.
The risk that any slowdown in hyperscaler spending or protocol adoption could put pressure on both top‑line growth and margins, which are already at high levels. ^[34]

Insider Monkey, in an article centered on Credo’s licensing pact with cabling specialist Siemon, acknowledges Credo’s rapid growth and role in AI infrastructure but argues that other AI names may offer better risk–reward, underscoring that even some bullish observers see CRDO as no longer undiscovered. ^[35]

Strategic drivers: AI “picks and shovels” and new growth pillars

Several recent analyses have framed Credo as an AI “picks and shovels” play—a supplier of critical connectivity hardware that benefits indirectly from exploding AI workloads rather than selling AI models or cloud capacity directly.

A Motley Fool article from December 7 characterized Credo as having “proved it’s an AI picks‑and‑shovels winner” after its earnings beat, noting that the stock jumped around 10% on the news. ^[36]
A TheStreet feature highlighted Credo as an AI stock up about 180% in 2025, attributing the move to surging demand for its HiWire AECs among hyperscalers and a wave of price‑target increases from major brokers. ^[37]

From management’s own commentary and Q2 transcript, three structural growth pillars stand out: ^[38]

Active Electrical Cables (AECs)
- Credo continues to ramp AEC shipments at 25G, 50G, and especially 100G per lane, with plans to follow customers to 200G per lane.
- The company has begun licensing its AEC IP to third parties, with the Siemon deal serving as an example of how it can monetize technology beyond its own cable products. ^[39]
Active Linear Cables (ALCs) and Hyperloom acquisition
- Through the acquisition of Hyperloom, Credo is developing ALCs using micro‑LED technology to deliver thinner, longer‑reach copper‑like connectivity at power and cost levels similar to AECs.
- Management targets initial revenue in fiscal 2027 and broader ramps in fiscal 2028, positioning ALCs as a potential bridge between copper and optics for AI back‑end networks. ^[40]
ZeroFlap (ZF) optics and BlueBird 1.6T DSP
- Credo’s ZF optical transceiver line is designed to reduce “link flaps” (frequent connect/disconnect events) in dense AI fabrics, aiming at 800G and eventually 1.6T ports at 100G per lane and beyond. ^[41]
- The BlueBird 1.6T optical DSP targets the next wave of high‑bandwidth, low‑latency AI interconnects where power efficiency is a major bottleneck for large‑scale deployments. ^[42]

Combined with ongoing PCIe Gen 6 “scale‑up” initiatives—where Credo plans to ship both retimers and AECs—these pillars are central to the company’s argument that it can sustain high growth for multiple years, even as the current AEC cycle matures. ^[43]

Risks: concentration, execution and valuation

Despite the enthusiasm, several recurring risk themes appear across today’s research and recent analyses:

Customer concentration: MLQ.ai and others note that a small number of hyperscalers still represent a large share of Credo’s revenue. Any slowdown or architectural shift at those customers could materially impact sales, even as management works to diversify across more hyperscalers and “next‑tier” data‑center operators. ^[44]
Competition from larger rivals: Credo operates in markets where Broadcom, Marvell and other established players are also aggressively investing. Differentiation on power, latency and cost will need to be sustained as these giants respond. ^[45]
Execution risk on new product lines: ALCs, ZF optics and Gen‑6/7 PCIe products are still in development or early sampling stages. Management emphasizes that the technology risk is largely solved and that the remaining challenge is execution, but delays or customer pushback could alter the growth profile. ^[46]
Valuation sensitivity: Whether you look at dynamic P/E metrics in the AInvest piece, the Simply Wall St fair‑value estimate, or GuruFocus’s GF Value model, several frameworks suggest little room for error at current levels, even after this week’s pullback. ^[47]

In short, the story now hinges as much on continued flawless execution and AI infrastructure momentum as it does on the already‑reported numbers.

What to watch next

For investors following CRDO after today’s swings, several upcoming catalysts and data points stand out:

Quarterly results vs. guidance: Credo has guided to continued mid‑single‑digit sequential growth through fiscal 2027, on top of very high year‑over‑year comps. How actual results track against the roughly $1.0 billion FY2026 revenue and $2.12–2.66 EPS trajectory in the Street’s models will heavily influence whether shares grow into their multiple. ^[48]
Adoption of 100G and 200G per‑lane solutions: Evidence that hyperscalers are accelerating upgrades to 100G and eventually 200G per lane—validated through design wins, product announcements and customer commentary—would support Credo’s long‑term TAM narrative. ^[49]
Progress on ALC and ZF optics: Concrete milestones such as sampling, initial purchase orders or early revenue for ALCs and ZF optics in fiscal 2027–2028 will help determine whether Credo truly becomes a multi‑pillar AI connectivity platform rather than a single‑cycle AEC story. ^[50]
Institutional positioning: With more than 70% of the float in institutional hands and new filings showing both buyers (Rokos, AXA) and sellers (Federated Hermes), shifts in ownership will continue to amplify both rallies and downturns. ^[51]

Bottom line

As of December 11, 2025, Credo Technology Group remains one of the most hotly debated AI hardware stocks on the market. The company is delivering hypergrowth with unusually high margins, backed by a strengthening balance sheet and a roadmap that extends well beyond today’s AEC‑driven cycle. ^[52]

At the same time, the share price now embeds very demanding expectations, and recent research—from AInvest’s volatility note to Simply Wall St’s fair‑value model and GuruFocus’s GF Value estimate—highlights how sensitive the stock could be to any disappointment in growth, margins or AI spending trends. ^[53]