Credo Technology Group Holding Ltd (NASDAQ:CRDO) director Tan Lip Bu recently sold a significant amount of the company's stock, transactions that totaled over $6.8 million. On September 30, 2024, Tan sold 13,820 ordinary shares at a weighted average price of $31.1198 per share. This sale was part of a series of transactions that occurred over several days.
The following day, on October 1, Tan continued selling shares, disposing of 61,180 ordinary shares at a weighted average price of $30.1709. The sales did not stop there; on October 2, an additional 150,000 shares were sold at a weighted average price of $30.4984. These transactions were executed in multiple trades, with prices ranging from $30.00 to $31.40 for the shares sold between September 30 and October 2.
After these transactions, Tan Lip Bu's indirectly held shares, through Walden Technology Ventures Investments II, L.P., amounted to 2,638,725 ordinary shares. The sales significantly reduced Tan's holdings in the company but still left him with a substantial interest. It's worth noting that Tan is the Managing Director of China Walden Venture Investment II G.P., Ltd., which is the general partner of Walden Technology Ventures Investments II, L.P.
Tan also has indirect ownership interests through A&E Investment LLC and the Lip-Bu Tan and Ysa Loo Trust, for which he is a joint trustee. However, he disclaims beneficial ownership of these shares except to the extent of his pecuniary interest.
Investors often monitor insider transactions such as these for insights into the perspectives of high-level executives and directors about their company's stock. While the reasons for Tan's sales are not disclosed in the filing, the reported transactions provide clear data on the recent activity.
The sales were disclosed in a Form 4 filing with the Securities and Exchange Commission, which was signed by attorney-in-fact James Laufman on behalf of Tan Lip Bu.
In other recent news, Credo Technology Group Holding Ltd. has seen significant developments. The company reported robust Q1 revenues for fiscal 2025, reaching $59.7 million with a non-GAAP gross margin of 62.9%. This represents a substantial year-over-year revenue increase of 70%, largely due to expanding AI deployments. Analysts from TD Cowen, Craig-Hallum, and Needham have maintained Buy ratings on Credo Technology, with raised price targets of $40.00, $38.00, and $33.00 respectively. The analysts' confidence stems from the company's strong financial performance and promising future guidance, including anticipated revenue growth in the latter half of 2025. Credo Technology also plans to enter the 64 gig PAM4 PCIe Gen 6 market later this year, aiming to capitalize on the growing demand for higher bandwidth driven by AI applications. These recent developments signify a positive trajectory for Credo Technology's financial future.
InvestingPro Insights
To provide additional context to Tan Lip Bu's recent stock sales, it's worth examining some key financial metrics and insights from InvestingPro for Credo Technology Group Holding Ltd (NASDAQ:CRDO).
According to InvestingPro data, Credo's market capitalization stands at $4.98 billion, reflecting the company's significant presence in the technology sector. The company has shown impressive revenue growth, with a 70.15% increase in quarterly revenue as of the most recent fiscal quarter. This strong top-line performance aligns with one of the InvestingPro Tips, which indicates that analysts anticipate sales growth in the current year.
Despite the recent insider selling, there are positive signals for Credo's financial health. An InvestingPro Tip highlights that the company holds more cash than debt on its balance sheet, suggesting a strong liquidity position. This is further supported by another tip noting that Credo's liquid assets exceed short-term obligations, which could provide reassurance to investors concerned about the company's financial stability.
However, it's important to note that Credo is currently trading at a high revenue valuation multiple, according to InvestingPro Tips. This high valuation, combined with the company's impressive 87.95% price return over the past year, may have influenced the director's decision to sell shares.
For investors seeking a more comprehensive analysis, InvestingPro offers 14 additional tips for Credo Technology Group, providing a deeper understanding of the company's financial position and market performance.
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