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Credo (CRDO) vs. Marvell (MRVL): Which AI Chip Stock Is the Better Buy?
Outside of Nvidia (NVDA - Free Report) ) and Broadcom (AVGO - Free Report) ), Credo Technology (CRDO - Free Report) ) and Marvell Technology (MRVL - Free Report) ) are two of the most searched-for chip stocks on Zacks.com, with each ranking among the site’s top 12 stock searches.
However, investor interest alone doesn’t make a stock a compelling buy. The key question is which company offers the better combination of AI exposure, earnings growth, and valuation.
Credo: Faster Growth Through AI Connectivity
Credo specializes in high-speed, energy-efficient connections that help AI infrastructure operate effectively. Its active electrical cables, optical products, and retimers—chips that restore high-speed signals—help connect processors, servers, and networking equipment. Rather than competing directly to build the most powerful AI processor, Credo supplies essential technology that keeps large AI systems communicating reliably.
That positioning is translating into exceptional growth. Earlier this month, Credo reported results for its fiscal first quarter, with Q1 revenue of $479 million soaring 115% year over year, while adjusted earnings jumped 131% to $1.20 per share. Its adjusted gross margin reached an impressive 68%, highlighting the profitability of Credo’s connectivity portfolio.
Looking ahead, the Zacks Consensus Estimate calls for Credo’s current fiscal 2027 revenue to rise 87% to $2.5 billion, with full-year EPS expected to soar 80% YoY to $6.23. Fiscal 2028 estimates point to another substantial expansion, with revenue projected to approach $3.74 billion and EPS reaching $9.30, representing roughly 50% growth, respectively.
Image Source: Zacks Investment Research
Marvell: Broader Exposure to AI Infrastructure
Marvell offers a wider range of AI infrastructure products, including custom-designed AI chips, optical-connectivity components, and Ethernet-switching silicon. Its five-year collaboration with Amazon’s (AMZN - Free Report) ) AWS spans custom AI products and multiple networking technologies, providing several avenues to benefit from expanding cloud and AI investment.
Marvell's latest quarterly results in August demonstrate this opportunity. Fiscal second-quarter 2027 revenue increased 37% to a record $2.74 billion, with Q2 adjusted EPS rising 40% to $0.94. Data-center revenue climbed 46% to $2.17 billion, accounting for 79% of total sales, while the company’s adjusted gross margin was 58.9%.
For the full year, the Zacks Consensus Estimate projects revenue growth of 46% to $12 billion, alongside 47% EPS growth to $4.19. Marvell's FY28 revenue is expected to climb another 50% to $18.02 billion, with earnings projected to increase another 58% to $6.62 per share. While Credo has the faster current-year growth trajectory, Marvell’s projected earnings growth is stronger in the following year.
Image Source: Zacks Investment Research
Performance & Valuation Comparison
Year to date, Credo shares have gained a modest 5%, while Marvell stock has surged 160%. Over the past two years, however, CRDO has soared more than 400%, outpacing MRVL’s 200% gain. Both stocks have beaten the broader market indexes and their Zacks Electronics–Semiconductors industry’s roughly 100% return over that period.
Image Source: Zacks Investment Research
Regarding valuation, Credo has a meaningful advantage, particularly considering its faster near-term growth. To that point, CRDO trades at $150 a share and at just under 30X forward earnings compared to MRVL at $221 a share and 72X.
However, the lower multiple does not eliminate business risk. Four customers accounted for approximately 84% of Credo’s latest quarterly revenue, and its outlook depends partly on successfully expanding its optical business. A spending slowdown at a major customer or a delayed product deployment could materially affect Credo’s results.
On the other hand, Marvell’s broader product portfolio provides a different investment proposition, but its higher earnings multiple demands substantial execution. Marvell’s anticipated custom-chip expansion must translate into the revenue and profit growth investors are already expecting.
Image Source: Zacks Investment Research
Bottom Line
Credo gets the edge for its combination of near-term growth and valuation, while Marvell offers broader exposure to custom AI chips and networking infrastructure.
Still, CRDO and MRVL stock both land a Zacks Rank #3 (Hold) at the moment. Following their tremendous rallies in recent years, investors may want to remain selective about entry points rather than chase either stock.
View the Zacks #1 Rank List
Image: Shutterstock
Credo (CRDO) vs. Marvell (MRVL): Which AI Chip Stock Is the Better Buy?
Outside of Nvidia (NVDA - Free Report) ) and Broadcom (AVGO - Free Report) ), Credo Technology (CRDO - Free Report) ) and Marvell Technology (MRVL - Free Report) ) are two of the most searched-for chip stocks on Zacks.com, with each ranking among the site’s top 12 stock searches.
However, investor interest alone doesn’t make a stock a compelling buy. The key question is which company offers the better combination of AI exposure, earnings growth, and valuation.
Credo: Faster Growth Through AI Connectivity
Credo specializes in high-speed, energy-efficient connections that help AI infrastructure operate effectively. Its active electrical cables, optical products, and retimers—chips that restore high-speed signals—help connect processors, servers, and networking equipment. Rather than competing directly to build the most powerful AI processor, Credo supplies essential technology that keeps large AI systems communicating reliably.
That positioning is translating into exceptional growth. Earlier this month, Credo reported results for its fiscal first quarter, with Q1 revenue of $479 million soaring 115% year over year, while adjusted earnings jumped 131% to $1.20 per share. Its adjusted gross margin reached an impressive 68%, highlighting the profitability of Credo’s connectivity portfolio.
Looking ahead, the Zacks Consensus Estimate calls for Credo’s current fiscal 2027 revenue to rise 87% to $2.5 billion, with full-year EPS expected to soar 80% YoY to $6.23. Fiscal 2028 estimates point to another substantial expansion, with revenue projected to approach $3.74 billion and EPS reaching $9.30, representing roughly 50% growth, respectively.
Image Source: Zacks Investment Research
Marvell: Broader Exposure to AI Infrastructure
Marvell offers a wider range of AI infrastructure products, including custom-designed AI chips, optical-connectivity components, and Ethernet-switching silicon. Its five-year collaboration with Amazon’s (AMZN - Free Report) ) AWS spans custom AI products and multiple networking technologies, providing several avenues to benefit from expanding cloud and AI investment.
Marvell's latest quarterly results in August demonstrate this opportunity. Fiscal second-quarter 2027 revenue increased 37% to a record $2.74 billion, with Q2 adjusted EPS rising 40% to $0.94. Data-center revenue climbed 46% to $2.17 billion, accounting for 79% of total sales, while the company’s adjusted gross margin was 58.9%.
For the full year, the Zacks Consensus Estimate projects revenue growth of 46% to $12 billion, alongside 47% EPS growth to $4.19. Marvell's FY28 revenue is expected to climb another 50% to $18.02 billion, with earnings projected to increase another 58% to $6.62 per share. While Credo has the faster current-year growth trajectory, Marvell’s projected earnings growth is stronger in the following year.
Image Source: Zacks Investment Research
Performance & Valuation Comparison
Year to date, Credo shares have gained a modest 5%, while Marvell stock has surged 160%. Over the past two years, however, CRDO has soared more than 400%, outpacing MRVL’s 200% gain. Both stocks have beaten the broader market indexes and their Zacks Electronics–Semiconductors industry’s roughly 100% return over that period.
Image Source: Zacks Investment Research
Regarding valuation, Credo has a meaningful advantage, particularly considering its faster near-term growth. To that point, CRDO trades at $150 a share and at just under 30X forward earnings compared to MRVL at $221 a share and 72X.
However, the lower multiple does not eliminate business risk. Four customers accounted for approximately 84% of Credo’s latest quarterly revenue, and its outlook depends partly on successfully expanding its optical business. A spending slowdown at a major customer or a delayed product deployment could materially affect Credo’s results.
On the other hand, Marvell’s broader product portfolio provides a different investment proposition, but its higher earnings multiple demands substantial execution. Marvell’s anticipated custom-chip expansion must translate into the revenue and profit growth investors are already expecting.
Image Source: Zacks Investment Research
Bottom Line
Credo gets the edge for its combination of near-term growth and valuation, while Marvell offers broader exposure to custom AI chips and networking infrastructure.
Still, CRDO and MRVL stock both land a Zacks Rank #3 (Hold) at the moment. Following their tremendous rallies in recent years, investors may want to remain selective about entry points rather than chase either stock.