Director of Credo Technology Group Holding Ltd (NASDAQ:CRDO), Tan Lip Bu, has recently sold a significant portion of his holdings in the company. Over the course of several transactions, Tan disposed of shares with a total value exceeding $14 million.
The sales were carried out between October 8 and October 10, with prices per share ranging from $33.2315 to $37.0433. On October 8, Tan sold 117,036 shares at an average price of $33.2315 and an additional 39,918 shares at an average price of $33.6396. The following day, he sold 125,000 shares at an average price of $35.1801. On October 10, two separate transactions took place: one for 108,700 shares at an average price of $36.1964 and another for 16,300 shares at an average price of $37.0433.
The filings indicate that these shares were held indirectly through Walden Technology Ventures Investments II, L.P., for which Tan is the Managing Director. He has disclaimed beneficial ownership of these shares, except to the extent of his pecuniary interest. Additionally, shares were held in trusts and entities associated with Tan, including the Lip-Bu Tan and Ysa Loo Trust and A&E Investment LLC.
Following these transactions, Tan still maintains a substantial interest in Credo Technology Group Holding Ltd, with indirect ownership stakes through various entities and trusts. Despite the sizable sale, the remaining holdings indicate a continued vested interest in the company's performance.
Investors and market watchers often look to insider buying and selling as a signal of a company's future prospects. The recent sales by a high-ranking insider at Credo Technology Group Holding Ltd will likely be of interest to those following the semiconductor industry and the company's financial health.
In other recent news, Credo Technology Group Holding Ltd has seen notable developments. The company announced a robust Q1 2025 performance, with revenues reaching $59.7 million and a non-GAAP gross margin of 62.9%. This strong performance was largely driven by expanding AI deployments. Additionally, Credo unveiled its new 800G ZeroFlap family of HiWire Active Electrical Cables, designed to enhance reliability and signal integrity in AI backend networks.
Analysts at TD Cowen, Craig-Hallum, and Needham have all maintained a Buy rating for Credo Technology. They express optimism about the company's potential for diversified revenue streams, anticipating a revenue inflection in the second half of fiscal year 2025. This is expected to be driven by accelerating ASIC revenue from multiple hyperscaler customers.
Furthermore, Credo Technology plans to enter the 64 gig PAM4 PCIe Gen 6 market later this year, aiming to capitalize on the growing demand for higher bandwidth driven by AI applications. The company's gross margins have shown a strong quarter-over-quarter increase, and shipments of Optical Digital Signal Processors are projected to be robust in fiscal year 2025. These developments highlight recent advancements in Credo Technology's operations and market strategy.
InvestingPro Insights
The recent insider selling by Credo Technology Group Holding Ltd's director Tan Lip Bu comes amid a period of significant growth for the company. According to InvestingPro data, Credo has experienced impressive stock performance, with a 130.02% price total return over the past year and a 91.27% return year-to-date. This strong momentum is further evidenced by the stock trading near its 52-week high, with a price that is 99.87% of its highest point in the past year.
Despite the large insider sale, there are positive indicators for Credo's financial health and growth prospects. InvestingPro Tips highlight that analysts anticipate sales growth in the current year, and the company is expected to become profitable. This aligns with the reported revenue growth of 25.9% in the last twelve months, and a substantial 70.15% quarterly revenue growth.
However, investors should note that Credo is trading at a high revenue valuation multiple, which may suggest the stock is priced for high growth expectations. The company's impressive gross profit margin of 62.47% indicates strong pricing power or efficient operations in its market segment.
For those interested in a deeper analysis, InvestingPro offers 18 additional tips for Credo Technology Group Holding Ltd, providing a more comprehensive view of the company's financial position and market performance.
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