Credo Technology Group Holding Ltd has just delivered one of the sharpest weekly moves in the semiconductor sector — up 31% to $221.64 — with shorts retreating and earnings arriving in days.
The most striking shift this week is in short positioning. Shorts have been covering fast, with SI % of FF dropping from roughly 5.5% to just under 5% in a single session on May 26 — the lowest reading in this 30-day window. Over the full week, estimated short interest fell nearly 12%, a meaningful unwind by any measure. The direction has been clear since mid-May, when SI touched a local peak near 5.9% of float; it has compressed steadily since. The borrow market confirms there is no tension here. Cost to borrow is just 0.36% — historically cheap — and availability is extraordinarily loose at 2,860%, meaning there are roughly 28 shares available to borrow for every one currently shorted. Short sellers who remain in the trade are not under structural pressure; those who covered this week appear to have done so by choice, not by necessity.
Options positioning tells a similarly relaxed story. The put/call ratio has eased to 0.85, fractionally below its 20-day average of 0.86 and close to neutral. The z-score of -0.19 confirms there is no statistically unusual skew in either direction. The 52-week range for the PCR runs from 0.56 to 1.62 — today's reading sits comfortably in the middle. Options traders are neither hedging aggressively nor piling into calls ahead of next week's earnings print on June 1.
The Street is broadly constructive, though a price-target stale-date caveat is worth noting. Goldman Sachs raised its target to $170 and Needham held at $220 back in mid-April — the stock has since blown past both. Rothschild initiated at Buy with a $206 target on May 1, and the consensus mean across 13 buy-rated analysts was around $209 as of that date. With the stock at $221, the share price has already overtaken the average analyst target, a configuration that historically invites target-price revisions upward rather than fresh buying from the Street. The bull case centres on greater than 75% year-on-year revenue growth in FY27, powered by hyperscaler adoption of advanced electronic components and the $500M optical contribution expected following the DustPhotonics acquisition. Bears point to customer concentration risk, third-party manufacturing dependency, and the integration costs of that acquisition.
Factor scores reinforce the growth narrative but flag valuation friction. EPS momentum ranks in the 97th percentile over 30 days and 95th over 90 days — Credo has been aggressively revised upward by forecasters. Analyst recommendation divergence from consensus also scores in the 96th percentile, flagging that there is meaningful dispersion in views even within a largely bullish crowd. On the other side, the forward EPS year-on-year growth score is just 1 out of 100, and the EV/EBIT factor ranks 19th — both suggesting the market is already pricing in a great deal. PE of roughly 35x and price-to-book above 11x back that up.
Institutional holders show broad-based accumulation. BlackRock added nearly a million shares to reach 10.7% of the company. Point72 — an active manager with a more tactical orientation — added 1.9 million shares in Q1 to hold over 4% of the company. SRS Investment Management built a near-fresh position of 2.4 million shares in Q1. Wellington added 1.3 million. The picture is one of wide institutional participation rather than concentration risk. Insider activity runs the other way: co-founder and CTO Chi Fung Cheng sold roughly 18,000 shares across multiple tranches on May 1, and CLO James Laufman sold a further 7,400 shares on May 19 at $169. These are disciplined programmatic sales against the backdrop of a strongly rising stock — the trades were executed well below where the stock closed this week, which frames them as planned rather than alarmed.
The earnings print on June 1 is the focal point. The two most recent results events show divergent outcomes: a 17.9% single-day gain after the March 2026 Q3 report, and a 13.3% drop following the earlier result — both five-day moves ultimately resolved in the same upward direction. Peer context adds texture: ALAB surged 47.8% this week, AEHR 31.5%, and FORM 16.2%, suggesting a powerful sector tailwind rather than CRDO-specific news alone. What June 1 will likely determine is whether the optical division ramp, the AEC growth trajectory, and any updated FY27 guidance language can justify — or re-anchor — a stock that has now outrun its analyst consensus.
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