NeoMagic (OTCMKTS:NMGC) versus Credo Technology Group (NASDAQ:CRDO) Critical Analysis

Credo Technology Group (NASDAQ:CRDO) and NeoMagic (OTCMKTS:NMGC) are both business services companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, valuation, risk, profitability, dividends, earnings and analyst recommendations.

Risk & Volatility

Credo Technology Group has a beta of 2, indicating that its share price is 100% more volatile than the S&P 500. Comparatively, NeoMagic has a beta of 0.38, indicating that its share price is 62% less volatile than the S&P 500.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Credo Technology Group	$184.19 million	18.79	-$16.55 million	($0.23)	-92.17
NeoMagic	N/A	N/A	N/A	N/A	N/A

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

Insider and Institutional Ownership

80.5% of Credo Technology Group shares are owned by institutional investors. 23.9% of Credo Technology Group shares are owned by insiders. Comparatively, 12.7% of NeoMagic shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Credo Technology Group	-20.59%	-7.82%	-6.89%
NeoMagic	N/A	N/A	N/A

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Credo Technology Group	1	1	6	0	2.63
NeoMagic	0	0	0	0	N/A

Credo Technology Group currently has a consensus price target of $23.00, suggesting a potential upside of 8.49%. Given Credo Technology Group’s higher probable upside, equities research analysts clearly believe Credo Technology Group is more favorable than NeoMagic.

Summary

Credo Technology Group beats NeoMagic on 6 of the 9 factors compared between the two stocks.

About Credo Technology Group

Credo Technology Group Holding Ltd provides various high-speed connectivCredo Technology Group Holding Ltd provides various high-speed connectivity solutions for optical and electrical Ethernet applications in the United States, Mexico, 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. 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 headquartered in San Jose, California.ity solutions for optical and electrical Ethernet applications in the United States, Mexico, Mainland China, Hong Kong, and internationally. Its products include integrated circuits, active electrical cables, and SerDes chiplets that are based on its serializer/deserializer and digital signal processor technologies. The company also offers intellectual property solutions consist of SerDes IP licensing. The company was founded in 2008 and is headquartered in San Jose, California.

About NeoMagic

NeoMagic Corporation designs and delivers semiconductors and software solutions for video, television, imaging, graphic, and audio devices. It offers microcontrollers; horizon digital picture frame and digital mobile TV solutions; and SOC processors, such as application processors and Neomobile TV solutions. The company, through its MercadoMagico.com division, operates an e-Commerce platform that allows user to buy and sell products from one another or buy premium electronic products. It sells its applications processors under the MiMagic brand name. The company was founded in 1993 and is based in Milpitas, California.