In a recent development at Credo Technology Group Holding Ltd (NASDAQ:CRDO), Lam Yat Tung, the Chief Operating Officer, executed a significant transaction by selling 10,000 ordinary shares of the company on September 12, 2024. The sales amounted to over $276,000, with share prices ranging from $26.7875 to $27.8408. These transactions were part of a Rule 10b5-1 trading plan adopted by Lam in July 2023, enabling company insiders to sell stocks through a predetermined strategy and protecting them from insider trading allegations.
Key Points:
- Lam sold 1,413 shares at a weighted average price of $26.7875, totaling about $37,859 in the first sale.
- In the second sale, Lam sold 8,587 shares at a weighted average price of $27.8408, amounting to approximately $239,060.
- Overall, Lam’s direct beneficial ownership of Credo Technology shares reduced to 2,885,840 as a result of these sales.
- The reported sales prices were based on the weighted average sale price for each transaction, varying from $26.40 to $27.29 and $27.48 to $28.19.
Moreover, a footnote in the SEC filing corrected previously erroneous numbers of securities beneficially owned by Lam, rectifying the direct ownership to 2,855,840 shares. Furthermore, the filing disclosed indirect holdings in entities associated with Lam, including 720,000 shares by Chung BVI Co Ltd and 1,270,000 shares by Zhan BVI Co Ltd. It’s crucial to note that Lam disclaims beneficial ownership of these shares except for any pecuniary interest.
Recent Company Developments:
Amidst this insider activity, Credo Technology Group Holding Ltd has been making strides in its operations. The company reported a robust start to fiscal 2025, with Q1 revenues soaring to $59.7 million and a non-GAAP gross margin of 62.9%. These results mark a 70% year-over-year revenue growth, driven primarily by expanding AI deployments. Looking ahead, Credo Technology aims to enter the 64 gig PAM4 PCIe Gen 6 market later this year to cater to the increasing demand for higher bandwidth propelled by AI trends.
Furthermore, analysts from TD Cowen, Craig-Hallum, and Needham have reaffirmed their Buy ratings on Credo Technology, with revised price targets reflecting the company’s stellar financial performance and promising outlook. This positive assessment is backed by Credo’s diversified revenue streams and expanding product offerings, suggesting a substantial revenue boost in the second half of fiscal year 2025.
InvestingPro Insights:
For investors evaluating Credo Technology Group Holding Ltd, it’s insightful to analyze the company’s financial metrics and stock performance through an analytical lens. With a market capitalization of $4.73 billion, Credo maintains a significant presence in the industry. Despite a negative P/E ratio, indicating current unprofitability, the strong gross profit margin of 62.47% signals effective cost management relative to revenue.
Key Points:
- Credo has witnessed considerable revenue growth, with a 25.9% increase over the last twelve months as of Q1 2025 and a quarterly growth of 70.15%.
- The company’s stock has yielded a substantial total return of 90.57% over the past year, reflecting positive market sentiment.
InvestingPro Tips:
InvestingPro offers two key insights for potential investors in Credo Technology. First, the company holds more cash than debt, enhancing financial stability. Second, analysts anticipate sales growth in the current year, which may bolster future success and positively impact stock performance.
For comprehensive analysis and additional InvestingPro Tips on Credo Technology Group Holding Ltd, delve into the 15 expert tips available at InvestingPro. These insights provide a deeper understanding of the company’s financial landscape and stock valuation, aiding informed investment decisions.
As investors navigate through the latest developments at Credo Technology and weigh potential investment opportunities, it’s imperative to stay informed and leverage expert insights for prudent decision-making. Embrace the dynamic landscape of the market, equipped with a nuanced understanding of key trends and performance indicators.
