Contrasting Broadcom (NASDAQ:AVGO) & Credo Technology Group (NASDAQ:CRDO)

Broadcom (NASDAQ:AVGO) and Credo Technology Group (NASDAQ:CRDO) are both large-cap computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, risk, earnings and valuation.

Risk and Volatility

Broadcom has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500. Comparatively, Credo Technology Group has a beta of 2.63, suggesting that its stock price is 163% more volatile than the S&P 500.

Earnings & Valuation

This table compares Broadcom and Credo Technology Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Broadcom	$63.89 billion	25.37	$23.13 billion	$4.76	71.81
Credo Technology Group	$436.77 million	62.01	$52.18 million	$1.14	131.53

Broadcom has higher revenue and earnings than Credo Technology Group. Broadcom is trading at a lower price-to-earnings ratio than Credo Technology Group, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

76.4% of Broadcom shares are owned by institutional investors. Comparatively, 80.5% of Credo Technology Group shares are owned by institutional investors. 2.0% of Broadcom shares are owned by insiders. Comparatively, 11.8% of Credo Technology Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Broadcom and Credo Technology Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Broadcom	0	1	29	3	3.06
Credo Technology Group	0	1	13	2	3.06

Broadcom currently has a consensus target price of $436.33, indicating a potential upside of 27.65%. Credo Technology Group has a consensus target price of $206.85, indicating a potential upside of 37.95%. Given Credo Technology Group’s stronger consensus rating and higher possible upside, analysts plainly believe Credo Technology Group is more favorable than Broadcom.

Profitability

This table compares Broadcom and Credo Technology Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Broadcom	36.20%	37.45%	16.51%
Credo Technology Group	26.63%	25.28%	21.92%

Summary

Credo Technology Group beats Broadcom on 8 of the 15 factors compared between the two stocks.

About Broadcom

Broadcom Inc. designs, develops, and supplies various semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products worldwide. The company operates in two segments, Semiconductor Solutions and Infrastructure Software. It provides set-top box system-on-chips (SoCs); cable, digital subscriber line, and passive optical networking central office/consumer premise equipment SoCs; wireless local area network access point SoCs; Ethernet switching and routing custom silicon solutions; serializer/deserializer application specific integrated circuits; optical and copper, and physical layer devices; and fiber optic components and RF semiconductor devices. The company also offers RF front end modules and filter; Wi-Fi, Bluetooth, and global positioning system/global navigation satellite system SoCs; custom touch controllers; inductive charging; attached small computer system interface, and redundant array of independent disks controllers and adapters; peripheral component interconnect express; fiber channel host bus adapters; read channel based SoCs; custom flash controllers; preamplifiers; optocouplers, industrial fiber optics, and motion control encoders and subsystems; light emitting diode, ethernet PHYs, switch ICs, and camera microcontrollers. Its products are used in various applications, including enterprise and data center networking, home connectivity, set-top boxes, broadband access, telecommunication equipment, smartphones and base stations, data center servers and storage systems, factory automation, power generation and alternative energy systems, and electronic displays. Broadcom Inc. was founded in 1961 and is headquartered in Palo Alto, California.

About Credo Technology Group

Credo Technology Group Holding Ltd provides various high-speed connectivity Credo Technology Group Holding Ltd provides various high-speed connectivity solutions for optical and electrical Ethernet applications in the United States, Taiwan, Mainland China, Hong Kong, and internationally. Its products include HiWire active electrical cables, optical digital signal processors, low-power line card PHY, serializer/deserializer (SerDes) chiplets, and SerDes IP, as well as integrated circuits, active electrical cables. The company also offers intellectual property solutions consist of SerDes IP licensing. It sells its products to hyperscalers, original equipment manufacturers, original design manufacturers and optical module manufacturers, as well as into the enterprise and HPC markets. The company was founded in 2008 and is based in Grand Cayman, Cayman Islands.