Credo Technology Group Holding Ltd. (NASDAQ:CRDO) is one of the 10 Stocks With Eye-Popping Gains.
Credo Technology climbed by 12.35 percent on Monday to close at $134.36 apiece, following news that it would expand into silicon photonics and optical connectivity in line with its goal to strengthen its foothold in the $6-billion market.
In a statement, Credo Technology Group Holding Ltd. (NASDAQ:CRDO) said that it is set to acquire DustPhotonics—a leading developer of Silicon Photonics Photonic Integrated Circuit (SiPho PIC) technology for optical transceivers, which boasts a portfolio of on-demand SiPho PIC portfolios including 400G, 800, and 1.6T.
Data center server racks. Photo by Brett Sayles on Pexels
The acquisition alone is expected to boost its optical revenues for the fiscal year 2027 to more than $500 million.
According to Credo Technology Group Holding Ltd. (NASDAQ:CRDO), the acquisition would position it as a key player in a vertically integrated connectivity stack for scale-out and scale-up networks, and address both electrical and optical interconnects across the full AI infrastructure buildout.
“This combination positions us at an inflection point in optical. As adoption accelerates across hyperscale AI infrastructure, we expect our optical business to scale into a meaningful and rapidly growing contributor by fiscal 2027,” Chairman, President, and CEO William Brennan said.
Acquisition aside, Jefferies issued a bullish outlook in its first coverage for the stock, assigning a “buy” recommendation and a price target of $175. The figure marked a 30-percent upside potential from its latest closing price.
Jefferies said that its coverage was based on the belief that its current stock price has yet to fully reflect its growth prospects from the booming artificial intelligence industry, with the listed firm’s active electrical cables expected to continue benefiting from data center buildouts.
The investment firm also noted its optimism for Credo’s move into optical transceivers through ZeroFlap optics, which it said could help bolster its revenues.
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