This weekly review checks the prior week's published stock posts against subsequent market action and company-specific developments. The review window runs Thursday May 29 through Wednesday June 4, 2026, Europe/Dublin time. Price moves use the latest available market data at the time of writing (June 5, 2026).
Summary
— Published May 29. Watchlist at $222.35. Latest $215.31. Move: −3.17%. Current read: thesis weakened — earnings beat but the stock sold off, and the guide, while above consensus, failed to clear the market's higher bar.
Credo Technology (CRDO)
1. What happened
CRDO closed at $215.31 on June 5, down 3.17% from the $222.35 publication price. But the straight-line percentage understates the drama. The stock ran into earnings — hitting an all-time high of $243.21 on June 1 — before collapsing ~10% in after-hours trading after the Q4 FY2026 print. The stock has been drifting lower since, with the post-earnings selloff more than reversing the pre-earnings run-up.
The earnings themselves were objectively strong. Q4 revenue of $437M grew 157% YoY and 7.4% QoQ. Non-GAAP EPS of $1.16 beat consensus estimates of $0.98 by 18%. Full-year FY2026 revenue more than tripled to $1.34B, with non-GAAP net income of $662M (more than 5x the prior year). Gross margins held at 68.3% (non-GAAP). Q1 FY2027 revenue guidance of $465-475M implies continued sequential growth. The company guided FY2027 revenue to grow 80%+ YoY, implying roughly $2.4B — above the $2.15B consensus that the original post identified as the key re-rating threshold.
So why did the stock sell off? The market was pricing in a beat-and-raise to an even higher level. Credo had beaten its own guidance every quarter, and with the stock trading at 38x sales going into the print, the bar was set for perfection. An 80%+ growth guide, while strong, implies deceleration from the 226% YoY rate. The stock was priced for hypergrowth, and the market seized on the deceleration narrative even though the absolute numbers were excellent. The original post flagged this risk explicitly: "a growth deceleration to below 100% YoY" would trigger multiple compression.
Post-earnings, analysts remained constructive. Jefferies raised its target to $270 from $225 and Mizuho raised to $290 from $260, both with Outperform ratings. Jensen Huang (NVIDIA CEO) reportedly endorsed Credo's technology, providing an external validation signal. The analyst community is treating the selloff as a valuation reset, not a thesis break.
2. Thesis check
The core thesis — Credo's AECs are the de facto standard for intra-rack AI cluster connectivity, with near-linear scaling to GPU deployments — is unchanged. The earnings print confirmed the business is firing on all cylinders: revenue tripled, margins held at 68%, and the FY2027 guide implies 80%+ growth. The CPO threat remains a 2029-2030 concern, not a 2026-2027 one. The DustPhotonics acquisition and Jensen Huang's endorsement add credibility to the optical roadmap.
What weakened: the stock was priced for hypergrowth at 38x sales, and the guide, while above consensus, signals that the 200%+ YoY growth chapter is closing. The original post's PEG of 0.40 thesis — that the market was mispricing growth — has been partially undermined: the market is now pricing in deceleration, and the stock is adjusting to that reality. The post-earnings selloff confirms that the pre-earnings entry at $222 was speculative, as the original post warned.
3. Action now
The original post's framework was prescient: "post-earnings on a guide that validates +50% FY2027 growth is more attractive" and "if the stock sells off on a guide miss toward $150-170, that could be a much more attractive entry." The guide did validate 80%+ growth, but the selloff has brought the stock down to $215 — not yet to the $150-170 zone, but notably cheaper than the $222 publication price. At $215, the stock is trading at roughly 30x sales (down from 38x at publication). The $150 stop-loss from the original post remains the hard floor. The $260 target is still achievable but requires patience — the multiple compression from hypergrowth to high-growth is still playing out.
4. Next checkpoint
Q1 FY2027 earnings, expected ~September 2026. Watch for: (1) whether Q1 revenue of $465-475M is reported at or above the high end, (2) gross margin trajectory — staying above 67% is critical, (3) whether the FY2027 revenue guide is raised at the Q1 print (a common pattern for Credo), (4) new hyperscaler customer announcements, and (5) DustPhotonics product milestones. Also monitor: Amazon SerDes/AEC design engineer job listings (the earliest warning of captive silicon). The original post's sell triggers remain in place: two consecutive quarters below 100% YoY growth, NVIDIA copper elimination at GTC 2027, or Amazon captive silicon signals.