Credo Technology Group Holding Ltd
Credo Technology Group Holding Ltd Fundamental Analysis
Credo Technology Group Holding Ltd (CRDO) shows moderate financial fundamentals with a PE ratio of 59.99, profit margin of 31.81%, and ROE of 29.56%. The company generates $1.1B in annual revenue with weak year-over-year growth of 1.26%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 87.3/100 based on profitability, valuation, growth, and balance sheet metrics. The B+ grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze CRDO's fundamental strength across five key dimensions:
Efficiency Score
ExcellentCRDO demonstrates superior asset utilization.
Valuation Score
ModerateCRDO shows balanced valuation metrics.
Growth Score
WeakCRDO faces weak or negative growth trends.
Financial Health Score
ExcellentCRDO maintains a strong and stable balance sheet.
Profitability Score
ExcellentCRDO achieves industry-leading margins.
Key Financial Metrics
Is CRDO Expensive or Cheap?
P/E Ratio
CRDO trades at 59.99 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, CRDO's PEG of 1.06 indicates fair valuation.
Price to Book
The market values Credo Technology Group Holding Ltd at 11.03 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 64.36 times EBITDA. This signals the market has high growth expectations.
How Well Does CRDO Make Money?
Net Profit Margin
For every $100 in sales, Credo Technology Group Holding Ltd keeps $31.81 as profit after all expenses.
Operating Margin
Core operations generate 30.23 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $29.56 in profit for every $100 of shareholder equity.
ROA
Credo Technology Group Holding Ltd generates $16.68 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Credo Technology Group Holding Ltd generates strong operating cash flow of $355.20M, reflecting robust business health.
Free Cash Flow
Credo Technology Group Holding Ltd generates strong free cash flow of $296.49M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $1.61 in free cash annually.
FCF Yield
CRDO converts 1.32% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
59.99
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
1.06
vs 25 benchmark
P/B Ratio
Price to book value ratio
11.03
vs 25 benchmark
P/S Ratio
Price to sales ratio
19.94
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.007
vs 25 benchmark
Current Ratio
Current assets to current liabilities
10.82
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.30
vs 25 benchmark
ROA
Return on assets percentage
0.17
vs 25 benchmark
ROCE
Return on capital employed
0.17
vs 25 benchmark
How CRDO Stacks Against Its Sector Peers
| Metric | CRDO Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 59.99 | 34.43 | Worse (Expensive) |
| ROE | 29.56% | 1135.00% | Weak |
| Net Margin | 31.81% | -134808.00% (disorted) | Strong |
| Debt/Equity | 0.01 | 7.92 | Strong (Low Leverage) |
| Current Ratio | 10.82 | 5.77 | Strong Liquidity |
| ROA | 16.68% | -310795.00% (disorted) | Strong |
CRDO outperforms its industry in 4 out of 6 key metrics, particularly excelling in Net Margin, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Credo Technology Group Holding Ltd's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
252.03%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
1603.69%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
375.43%
Industry Style: Growth, Innovation, High Beta
High Growth