Buffett Brain · Research note
Score updated 27 Oct 2026 · analysis from 18 May 2026
CRDO· Technology
Credo Technology Group
Credo's AEC technology rides the AI infrastructure wave, but an 89x P/E with negative free cash flow conversion is a no-go.
Buffett fit
Weak fit
Owner
62
Durability
32
Management
56
Price
17
Score updated 27 Oct 2026 · analysis from 18 May 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Technology stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
Owning Credo privately for ten years means betting the AI infrastructure cycle stays vertical and that Credo's technology stays in-spec at 1.6T and 3.2T speeds.
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Through 2036, Credo's durability depends on staying ahead of competitors at each new bandwidth node and on hyperscaler capex staying elevated.
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Share count grew 4.6% annually, stock-based comp dilution that's typical for growth semis but expensive for shareholders.
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At 89x and 0.09% yield, the math is unfavorable on any sensible discount-rate assumption.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1 of 67.8% reflects IP-
- 2 of 30.2% rare for a hyper-growth semi
- 35-year revenue CAGR of 65% confirms genuine AI-cycle traction
- 4 of just 0.007 and current ratio of 10.8 leave the balance sheet fortress-strong
Concerns
6- 1 of 89 and yield of 0.09% offer no
- 2EV/ of 823 prices in a decade of flawless execution
- 3Worst 5-year EPS decline of -64% confirms cyclical-tech volatility
- 4Share count grew 4.6% annually, meaningful dilution from stock comp
Price history
$151+1,250.8%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Credo designs Active Electrical Cables and serdes IP that knit together AI data-center bandwidth, selling into Nvidia-class hyperscaler buildouts. of 67.8% on of 30.2% reflects the IP- of fabless semis at a hyper-growth moment. 5-year revenue CAGR of 65% is staggering, but EPS CAGR of just 16% reveals the cost of stock-based comp and reinvestment. The thesis is real; the price has discounted years of perfect execution.
What other investors would say
The same company, judged by three other documented playbooks.
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