Credo (CRDO) Stock: Three Analysts Say Buy After DustPhotonics Deal

TLDR

• Credo Technology has completed its acquisition of DustPhotonics in a cash-and-stock deal worth $750M upfront plus ~0.92M common shares.
• DustPhotonics brings silicon photonics PIC technology covering 800G, 1.6T, and 3.2T near-packaged and co-packaged optics.
• The combined portfolio — ZeroFlap optical transceivers, optical DSPs, and silicon photonics — is expected to be a growth driver in fiscal 2027.
• CRDO was trading at $220.32 pre-market, down 0.41%, and has surged 253% over the past year.
• Analysts at Stifel, Jefferies, and Rothschild Redburn all carry Buy ratings, with price targets ranging from $206 to $250.

Credo Technology (CRDO) officially closed its acquisition of DustPhotonics on Wednesday, adding silicon photonics capability to its existing optical and copper interconnect portfolio.

Credo Technology Group Holding Ltd, CRDO

CRDO was trading at $220.32 pre-market, down 0.41% on the day, though the stock has climbed 253% over the past year and sits near its 52-week high of $233.70.

The deal was first announced in April. The terms: $750 million in upfront cash plus approximately 0.92 million common shares. Financial terms beyond that were not disclosed.

DustPhotonics specializes in silicon photonics photonic integrated circuit (SiPho PIC) technology. It deepens Credo’s optical interconnect coverage across 800G, 1.6T, and 3.2T near-packaged optics (NPO) and co-packaged optics (CPO).

The combined technology stack now includes SerDes, digital signal processing, silicon photonics, and system integration for both electrical and optical interconnects. That’s a fairly complete toolkit for high-speed data infrastructure.

Fiscal 2027 Is the Target

Credo said it expects the combined portfolio — ZeroFlap optical transceivers, optical DSPs, and silicon photonics products — to become a growth driver in fiscal 2027. The company posted revenue growth of 226% over the last twelve months and carries a gross profit margin of 67.83%.

Ronnen Lovinger, who joined Credo as VP of Silicon Photonics through the deal, said the technology is designed to address bandwidth and efficiency demands in infrastructure applications.

Analyst Reaction

Wall Street has been generally upbeat. Stifel raised its price target to $250 with a Buy rating, citing anticipated revenue above $430 million and non-GAAP EPS of $1.02, supported by active electrical cable ramps at multiple hyperscalers.

Jefferies lifted its target to $225 following the deal close, projecting optics revenue could exceed $500 million by fiscal 2027.

Rothschild Redburn initiated coverage with a Buy rating and a $206 target, focusing on Credo’s core AEC cable business as the anchor.

InvestingPro’s analysis flagged the stock as currently trading above its Fair Value estimate — worth keeping in mind given the run-up.

Beyond the DustPhotonics deal, Credo recently announced a collaboration with Rebellions to integrate ZeroFlap AEC cables into the RebelPOD AI cluster architecture. The company is also set to appear at TSMC’s 2026 Technology Symposium series to showcase its memory solutions.

Most recently, CRDO was at $220.32 pre-market on Wednesday, with three analyst Buy ratings and price targets between $206 and $250 on the board.

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