Contrasting MaxLinear (NASDAQ:MXL) & Credo Technology Group (NASDAQ:CRDO)

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

Institutional & Insider Ownership

80.5% of Credo Technology Group shares are owned by institutional investors. Comparatively, 90.8% of MaxLinear shares are owned by institutional investors. 16.0% of Credo Technology Group shares are owned by insiders. Comparatively, 8.6% of MaxLinear shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Credo Technology Group and MaxLinear, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Credo Technology Group	0	0	9	1	3.10
MaxLinear	0	3	4	0	2.57

Credo Technology Group presently has a consensus target price of $74.90, suggesting a potential upside of 84.89%. MaxLinear has a consensus target price of $25.50, suggesting a potential upside of 132.03%. Given MaxLinear’s higher probable upside, analysts plainly believe MaxLinear is more favorable than Credo Technology Group.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Credo Technology Group	-9.70%	-2.94%	-2.60%
MaxLinear	-68.01%	-21.94%	-13.58%

Risk and Volatility

Credo Technology Group has a beta of 2.16, suggesting that its stock price is 116% more volatile than the S&P 500. Comparatively, MaxLinear has a beta of 1.76, suggesting that its stock price is 76% more volatile than the S&P 500.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Credo Technology Group	$327.53 million	21.00	-$28.37 million	$0.01	4,051.00
MaxLinear	$360.53 million	2.58	-$245.20 million	($2.93)	-3.75

Credo Technology Group has higher earnings, but lower revenue than MaxLinear. MaxLinear 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.

Summary

Credo Technology Group beats MaxLinear on 11 of the 15 factors compared between the two stocks.

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.

About MaxLinear

MaxLinear, Inc. provides communications systems-on-chip solutions worldwide. Its products integrate various portions of a high-speed communication system, including radio frequency, high-performance analog, mixed-signal, digital signal processing, security engines, data compression and networking layers, and power management. The company's products are used in various electronic devices, such as radio transceivers and modems for 4G/5G base-station and backhaul infrastructure; optical transceivers targeting hyperscale data centers; Wi-Fi and wireline routers for home networking; broadband modems compliant with data over cable service interface specifications, passive optical fiber standards, and digital subscriber line, as well as power management and interface products. It serves electronics distributors, module makers, original equipment manufacturers, and original design manufacturers through a direct sales force, third-party sales representatives, and a network of distributors. The company was incorporated in 2003 and is headquartered in Carlsbad, California.