Overview
- Evercore ISI initiated formal coverage on Monday with an Outperform rating and a $325 price target that implies about 20% upside from recent trading levels.
- Analyst Mark Lipacis laid out aggressive forecasts that include 100% revenue growth in Credo’s Active Electrical Cable (AEC) business in 2026, 60% growth in 2027, and earnings per share above $13 by 2028.
- Evercore’s bull case rests on AECs being cheaper and lower power for short data‑center runs and on Credo using its DustPhotonics acquisition to add silicon‑photonics and optical products as distance needs grow.
- The note warns that high customer concentration with a few hyperscalers, production and inventory ramps, and any slowdown in data‑center capital spending could cause sharp near‑term volatility in Credo’s results and stock.
- Evercore downgraded TE Connectivity the same day, underscoring the firm’s preference for specialized AI‑connectivity pure plays and reflecting growing analyst focus on Credo after its recent $437 million fiscal quarter and market‑cap gains.