We put together a list of the 15 Best New Tech Stocks To Invest In. Now, let’s see how Credo Technology Group Holding Ltd (NASDAQ:CRDO) compares to its peers.
On January 8, Rashaun Williams, a venture capitalist and limited partner with the Atlanta Falcons, shared insights on CNBC’s “Closing Bell.” He talked about his investment approach and what he sees for the IPO market as 2025 gets underway. He noted there is hope for a rebound in tech IPOs, but pointed out that for this optimism to hold, several key factors need to fall into place. Nevertheless, he encouraged viewers to stay hopeful, as the tech IPO space plays a vital role in fostering innovation and economic growth. He also mentioned that while the primary IPO market struggles, the secondary market is thriving, providing liquidity to company founders and employees. This is crucial for companies to endure tough times.
Williams also shared his views as an alternative investment manager, noting a trend toward alternative assets. He pointed out an increasing interest in late-stage tech firms, especially in AI and cybersecurity. These areas are essential for his portfolio and show great promise due to their transformative potential and relevance in today’s tech landscape.
On the same day, Keith Fitz-Gerald, from Fitz-Gerald Group, appeared on CNBC’s “The Exchange.” He shared his positive outlook on the tech sector, despite the NASDAQ 100 dropping 1.5%, mostly due to NVIDIA’s 5% decline. Fitz-Gerald sees this downturn as an opportunity. He believes that AI’s potential for monetization is just on the horizon and even predicted the S&P 500 could surpass 7,000 by midyear. This optimistic view stems from his confidence in strong US-based AI companies with solid market positions and profit margins.
Regarding concerns over high valuations, he explained that while high price-to-earnings (P/E) ratios often predict lower returns, this doesn’t apply the same way to digital companies. In businesses leveraging economies of scale, like AI firms, higher P/E ratios can indicate strength rather than overvaluation. He believes the current market softness is a technical shift due to large traders moving funds, not a sign of weak fundamentals. Fitz-Gerald asserted that the surge in AI investment marks just the beginning of a transformative tech era.
Methodology
To create our list, we used the Finviz stock screener to identify companies that have gone public in the last three years, focusing on those with market caps exceeding $1 billion. We sorted them by IPO date and selected stocks favored by top hedge funds, particularly those analysts are excited about. We ranked these 15 stocks based on how many hedge funds hold them, as of Q3 2024.
Why focus on stocks hedge funds invest in? Research shows that mimicking the best hedge fund picks can lead to market outperformance. Our quarterly newsletter selects 14 small-cap and large-cap stocks each quarter, achieving a 275% return since May 2014, outperforming the benchmark by 150 percentage points.
Credo Technology Group Holding Ltd. (NASDAQ:CRDO) specializes in high-speed connectivity solutions for data centers and networking applications. The company develops innovative products like SerDes, PHY chips, and active cables for major players in the industry. Their solutions ensure fast and reliable data transfer.
Market Capitalization as of January 21: $13.21 billion
Number of Hedge Fund Holders: 30
Analysts at Stifel recently raised their price target for Credo to $85 from $80, keeping a Buy rating. They highlighted the importance of active copper technology over traditional solutions. Stifel believes Credo is well-positioned to benefit from the increasing AI-driven spending in data centers. The company recorded $72 million in revenue in FQ2 2025, driven by demand for its Active Electrical Cable (AEC) products.
The rise of AI-driven data center architectures demands high-speed and reliable connectivity, which Credo’s AECs deliver effectively. These products outperform traditional optical solutions, eliminating costly disruptions known as Link Flaps, which can impact productivity in AI clusters. As AI usage grows, Credo anticipates an increase in demand for its AECs throughout the industry.
TimesSquare Capital Management shared its preference for companies like Credo that provide essential systems and adapt to growing IT budgets. Their Q2 report reflected strong performance and a positive outlook, driven by AI investments. As stated in their investor letter:
“Among a variety of Information Technology companies, we favor those who provide critical systems and specialized components. These companies enhance productivity and align with the growing corporate IT budget. Credo Technology Group Holding Ltd (NASDAQ:CRDO) surged by 51%. They reported solid results and the guidance met our expectations; AI spending is a key growth driver.”
Overall, CRDO ranks 4th on our list of new tech stocks to consider. While we see potential in CRDO, we believe there are AI stocks that could provide even better returns in a shorter time frame. If you’re interested in an AI stock with appealing value, check out our report on the cheapest AI stock.
Disclosure: None. This article was originally published at Insider Monkey.
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Rashaun Williams, IPO market, tech companies, hedge funds, NASDAQ 100, Atlanta Falcons
