Credo: AEC Dominance, Pricing Power, And Operating Leverage Justify Premium Valuations
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Juxtaposed Ideas14.97K FollowersFollow5ShareSavePlay(12min)CommentsSummaryCredo Technology is upgraded to a Buy, thanks to the improved margin of safety from the recent consolidation at the 50 DMAs and the triple digits adj. EPS growth profile.CRDO commands an 88% AEC market share, with the hyperscalers' intensified data center capex trends and the ongoing compute densification underpinning its durable growth trends.The expanding consumer base, the higher pricing power/improved operating leverage, and the healthy balance sheet also imply its ability to remain highly relevant during the multi-year cloud supercycle.The current consensus FY2028 revenue estimates of $2B appear somewhat conservative, against the outsized projected AEC market size of $4B in 2028.Combined with the reasonable technical indicators and the established trading pattern since September 2025, interested investors may add CRDO nearer to my Buy Zones of the $140s/130s. akinbostanci/iStock via Getty Images I previously covered Credo Technology Group Holding Ltd. (NASDAQ:CRDO) in September 2025, discussing how its triple-digit rally since the April 2025 bottom might be attributed to the expanding hyperscaler partnership and the bottom-line inflection. DespiteThis article was written byJuxtaposed Ideas14.97K FollowersFollowI am a full-time analyst interested in a wide range of stocks. With my unique insights and knowledge, I hope to provide other investors with a contrasting view of my portfolio, given my particular background.If you have any questions, feel free to reach out to me via a direct message on Seeking Alpha or leave a comment on one of my articles.Analyst’s Disclosure:I/we have a beneficial long position in the shares of NVDA, AVGO either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. The analysis is provided exclusively for informational purposes and should not be considered professional investment advice. Before investing, please conduct personal in-depth research and utmost due diligence, as there are many risks associated with the trade, including capital loss.Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.Recommended For You