Is Credo Technology Group Holding Ltd. overvalued or undervalued?

As of 2 June 2025, the valuation grade for Credo Technology Group Holding Ltd. has moved from attractive to fair. The company is currently fairly valued based on its financial metrics. The P/E ratio stands at 234, significantly higher than the industry average, while the EV to EBITDA ratio is 228.50, indicating a premium valuation relative to earnings. Additionally, the PEG ratio is 0.81, suggesting that the stock may be undervalued in terms of growth expectations.
In comparison to peers, Credo's P/E ratio is notably higher than Box, Inc., which has a P/E of 22.48 and is rated attractive. ASGN Incorporated, another peer, is rated fair with a P/E of 14.13. Despite its high valuation ratios, Credo has shown strong stock performance, with a year-to-date return of 25.83%, outperforming the S&P 500's 2.44% in the same period. Overall, while the company is fairly valued, its high ratios suggest that it may be overvalued compared to its peers.