Credo Technology Group Holding Ltd's (NASDAQ:CRDO) Chief Technology Officer, Cheng Chi Fung, has completed a significant sale of company stock, according to recent filings. On July 19th, Cheng sold 55,000 shares of the semiconductor firm at a weighted average price of $29.3004, totaling over $1.6 million.
This transaction was executed in multiple trades with prices ranging from $28.90 to $29.67. The details provided in the filing indicate that the sales were made through the Cheng Huang Family Trust, for which Cheng and his spouse serve as trustees. The trust also counts their children as beneficiaries. Cheng has specified that he disclaims beneficial ownership of the shares except to the extent of his pecuniary interest.
Following this transaction, Cheng still holds a substantial amount of Credo Technology shares indirectly through the trust, with ownership of 9,333,602 ordinary shares reported. Additionally, Cheng holds 134,391 ordinary shares directly.
This move by a top executive at Credo Technology is notable to investors tracking insider activity as an indicator of the company's health and the confidence that its leaders have in its future prospects. The sale represents a significant divestment by the CTO, yet his remaining stake indicates a continued vested interest in the company's performance.
Investors and the market often look to such insider transactions for insights, although they may not always indicate a change in company direction. The reasons for such sales can vary widely from personal financial planning to diversifying assets.
Credo Technology Group Holding Ltd specializes in semiconductors and related devices, a sector that has been at the forefront of technology and innovation. The company's performance and the actions of its executives are closely watched by investors interested in the tech industry.
For those interested in the complete transaction details, the filing with the SEC can provide the full context of the stock sale by Cheng Chi Fung.
In other recent news, Credo Technology Group Holding Ltd. reported record revenues for the fourth quarter of fiscal year 2024, primarily driven by robust demand for its artificial intelligence (AI) applications. The company's Q4 revenue reached a significant $60.8 million, marking an 89% increase year-over-year. AI deployments were a key growth driver, contributing to approximately three-quarters of Q4 revenue. Furthermore, Credo's IP business also saw substantial growth, generating $16.6 million in Q4, up 193% year-over-year.
TD Cowen has revised its outlook on Credo, raising the price target to $40 from $35, while reaffirming a Buy rating on the stock. The decision follows investor meetings with Credo's management, which bolstered TD Cowen's confidence in the company's strategic position in the industry and its unique low-power product offerings. TD Cowen also upgraded Credo's stock rating from Hold to Buy, reflecting a positive outlook on the company's role as a significant contributor to the advancement of higher line-rate speeds.
Looking ahead, Credo anticipates a continued expansion in AI revenue and a strategic focus on customer-specific solutions. The company expects AI revenue to double from Q4 fiscal year '24 to Q4 fiscal year '25. These are recent developments that underline Credo's promising market opportunities and potential for growth.
InvestingPro Insights
Amidst the news of Credo Technology Group Holding Ltd's (NASDAQ:CRDO) CTO Cheng Chi Fung's recent stock sale, investors may seek additional context on the company's financial health and market performance. According to InvestingPro data, Credo Technology currently holds a market capitalization of approximately $4.88 billion USD. Despite a negative P/E ratio in the last twelve months as of Q4 2024, indicating that the company is not currently profitable, there are signs of potential growth. Revenue growth was robust at 89.42% for the quarter, signaling a strong increase in sales.
Investors might also be interested in the company's gross profit margin, which stands at an impressive 61.89% as of the same period. This indicates that Credo Technology is effective in managing its cost of goods sold and could be a positive sign for future profitability. Furthermore, the company's stock has experienced a significant return of 80.88% over the past year, suggesting a positive reception from the market.
Adding to the narrative, InvestingPro Tips highlight that analysts have revised their earnings upwards for the upcoming period, and predict that Credo Technology will be profitable this year. Additionally, the company's strong cash position is noted, as it holds more cash than debt on its balance sheet. This could provide further assurance to investors about the company's financial stability and its ability to fund operations and growth initiatives.
For those seeking deeper insights, there are 16 additional InvestingPro Tips available for Credo Technology at https://www.investing.com/pro/CRDO. Investors looking to leverage these insights can use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, providing a comprehensive analysis that could enhance investment decisions.
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