Credo (CRDO) Stock Jumps After Q3 Revenue Forecast Tops Estimates

TLDR

• Credo Technology Group (CRDO) stock jumped 10.8% Monday to $123.41 after announcing Q3 revenue guidance of $404-$408 million, crushing previous estimates of $335-$345 million
• The company reported strong Q2 results with EPS of $0.67 versus $0.49 expected and revenue of $268 million, up 272% year-over-year
• Wall Street analysts raised price targets to the $165-$240 range with a consensus “Moderate Buy” rating and average target of $216.54
• Credo projects over 200% year-over-year growth for fiscal 2026, with Q4 revenue expected to grow mid-single digits sequentially
• Insiders sold roughly 917,976 shares worth $136.6 million last quarter, though they still maintain 11.84% ownership of the company

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Credo Technology Group (CRDO) stock surged Monday following the company’s announcement of preliminary third-quarter revenue guidance that smashed expectations. The stock climbed 10.8% to close at $123.41 with trading volume hitting 8.05 million shares, a 17% increase from the average daily volume.

The San Jose-based connectivity solutions provider announced it expects Q3 fiscal 2026 revenue between $404 million and $408 million. This crushes the company’s previous guidance range of $335 million to $345 million and beats analyst consensus estimates of $341.2 million.

Credo Technology Group Holding Ltd, CRDO

The revenue blowout continues Credo’s explosive growth trajectory. The company has seen revenue surge 224% over the last twelve months as demand for high-speed connectivity solutions in AI infrastructure continues to accelerate.

Strong Quarterly Performance Fuels Momentum

Credo’s most recent quarterly results showed the company firing on all cylinders. The company reported earnings per share of $0.67, beating analyst estimates of $0.49 by $0.18.

Revenue came in at $268.03 million for the quarter, compared to analyst estimates of $234.99 million. The year-over-year comparison looks even more impressive, with revenue up 272.1% from the same quarter last year when the company earned just $0.07 per share.

Net margin stood at 26.63% with a return on equity of 25.28%. These profitability metrics demonstrate the company’s ability to convert revenue growth into bottom-line results.

The company now projects sequential revenue growth in the mid-single digits for Q4. This trajectory puts Credo on track for more than 200% year-over-year growth for the full fiscal year 2026.

Wall Street Raises Price Targets

Analyst enthusiasm for Credo has reached fever pitch. Multiple firms raised their price targets following the recent results and guidance update.

Susquehanna lifted its target from $165 to $175. Bank of America made a more dramatic move, boosting its target from $165 to $240.

Mizuho increased its target from $165 to $225. Wolfe Research set a $240 price objective on the stock.

The consensus rating among analysts sits at “Moderate Buy” with one Strong Buy rating, eleven Buy ratings, and three Hold ratings. The average price target of $216.54 implies upside of roughly 75% from current levels.

Needham added Credo to its Conviction List and named it a Top Pick for 2026 with a $220 price target. The firm expects the company to continue beating consensus estimates driven by increasing Active Electrical Cable adoption and new product launches.

Rosenblatt Securities initiated coverage with a Neutral rating and a $170 price target.

Insider Activity and Market Position

Despite the strong performance, company insiders have been selling. CEO William Joseph Brennan sold 50,000 shares on December 11th at an average price of $153.16 for a total of $7.66 million.

CTO Chi Fung Cheng sold 55,000 shares on December 8th at $174.70 per share for $9.61 million. In total, insiders sold 917,976 shares worth $136.57 million in the last quarter.

Insiders still own 11.84% of the company’s stock. Institutional investors hold 80.46% of shares.

The company has a market capitalization of $22.29 billion. The stock trades at a price-to-earnings ratio of 97.72 and has a beta of 2.65.

Credo’s 50-day moving average sits at $144.08, with the 200-day moving average at $142.69. The company maintains gross profit margins near 67% and a return on assets exceeding 20%.

The company will release complete Q3 financial results during its earnings call scheduled for March 2, 2026, at 2:00 p.m. Pacific Time.

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