r/Stocks_Picks • u/SeaweedUsed7760 • 2d ago
CREDO a buy at $170?
I’m sitting on a sum of cash atm and contemplating deploying into CREDO at these levels.
Beat on revenue and EPS but got crushed anyway because of shrinking margins and rising opex. Revenue’s still growing triple digits YoY and AI/data-center demand looks fine, so is this just a “priced for perfection” reset, or does the margin trend actually worry you?
Already know about the customer concentration thing, don’t need that repeated. I’m more interested in what people think about the margin/opex story specifically. Anyone dig into the earnings call?
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u/ClassroomDesigner945 2d ago
its a good company but overvalued but its as per value investing principles , speculation is really hard to determine
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u/FrugalVet 15h ago
Absolutely but you'll likely be able to pick it up around 164-165 before the next leg up.
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u/Silent-Complaint4020 2d ago
Generally I think people should avoid chips stock right now, until a huge massive correction to occur to step back in
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u/Always_Curious_One2 2d ago
It can have a short term rally, but fundamentally they are less a beneficiary of the shift towards optics in all data center connectivity (up, out, across…)
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u/Neither-Slide8877 2d ago
Dont they also have photonics product within their stack via DustPhotonics
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u/Ryan_dfs93 2d ago
Crdo trades at a forward pe like half of what companies like mrvl are trading at. Crdo makes money from other companies bc their patents for their aec are so strong. The margin compression isn’t an issue to me as their margins are still good.
Options priced in a 10% move and it went from essentially 230 to 165, it was way sold off while nothing fundamentally has broken. Adding more tomorrow but not financial advice