<\/p>\n
Marvell (MRVL) stock closed the May 28 trading session up 3.09% at $204.03. The upbeat close followed the release of the first-quarter (Q1) fiscal year 2027 earnings report on May 27. <\/p>\n
The stock has rallied 141% year to date, as of Friday morning, May 29. Meanwhile, the SPDR S&P 500 index (SPY) is up about 10.66% in the same period.<\/p>\n
The fabless semiconductor giant has outpaced the S&P 500, thanks to its participation in the broader semiconductor rally driven by the AI boom.<\/p>\n
Positive news driving Marvell\u2019s stock includes:Strong fourth-quarter (Q4) fiscal 2026 earnings report in MarchAmazon\u2019s extension of its partnership with AnthropicMarvell\u2019s acquisition of Polariton TechnologiesIntel\u2019s first-quarter earnings boost confidence in the semiconductor sectorNvidia invested $2 billion and entered into a partnership with MarvellAMD invested $6.5 million in Marvell<\/p>\n
Analysts have been resetting their price targets just before earnings, as the expectations were high. Now that the earnings have dropped, Bank of America has tweaked its price target again.<\/p>\n
Key facts from Marvell\u2019s Q1 earnings report<\/p>\n
Marvell reported record revenue of $2.418 billion, up 28% year over year (YoY). GAAP and non-GAAP gross margins were at 52.1% and 58.9%, respectively.<\/p>\n
The company has a vast portfolio of products that spans computing, including custom AI chips (XPUs), optics, networking, storage, and security.<\/p>\n
Probably the most important products in Marvell\u2019s portfolio are Data Center Interconnect (DCI) Modules, which are used to transmit data over regional fiber networks.<\/p>\n
Chairman and CEO Matt Murphy touted the growth of the interconnect module sales during the earnings call.<\/p>\n
\u201cThe increase in our revenue outlook continues to be driven by our data center business, which we now expect to grow approximately 50% this fiscal year. Notably, we expect our interconnect business to grow more than 70% [YoY], well above our prior expectation of 50% growth.\u201d<\/p>\n
Marvell reported record revenue of $2.418 billion, up 28% year over year.<\/p>\n
Shutterstock<\/p>\n
Marvell provided guidance for Q2:Net revenue of $2.700 billion +\/- 5%GAAP gross margin in the range of 52.1% to 53.1%GAAP diluted net income per share of $0.37 +\/- $0.05 per share<\/p>\n
The company also raised its fiscal year 2028 revenue outlook, now expecting 45% YoY growth to $16.5 billion. This is approximately $1.5 billion higher than the prior outlook.<\/p>\n
Bank of America raises Marvell stock price target<\/p>\n
In a research note shared with me, Bank of America analyst Vivek Arya and his team updated their opinion on Marvell stock.<\/p>\n
The team noted that the company beat and raised again, as the optics business continues to grow.<\/p>\n
Analysts raised their fiscal year 2027, 2028, and 2029 pro forma EPS estimates by 6%, 9%, and 29%, respectively, to $4.06, $6.11, and $10.02. They noted that their model suggests Marvell\u2019s pro forma EPS could be 2.5x by 2028 and nearly 4x by 2030.<\/p>\n
More Tech Stocks:<\/p>\n
Bank of America resets Amazon stock forecast on key product launchBank of America resets Microsoft stock forecast after earningsBank of America resets Google stock forecast after key event<\/p>\n
Arya said the outlook of $10 billion in XPU sales for fiscal year 2029 provided by Marvell\u2019s management is reasonable. However, he noted that the company\u2019s free cash flow margin, which is in the 20% to 25% range, is below that of other high-growth AI peers, such as Nvidia, Broadcom, Credo Technology, and Astera Labs, which are in the 35% to 50% range.<\/p>\n
Arya reiterated a buy rating for Marvell stock and raised the price target to $240 from $200.<\/p>\n
Of 38 analyst ratings, 32 rate Marvell a buy and six a hold, with an average price target of $208.64, according to MarketBeat.<\/p>\n
Bank of America analysts noted downside risks for Marvell:Loss of visibility in key custom Application-specific integrated circuit (ASIC) projectsCompetition in AI computeCyclical industry risks, including a potential slowdown in legacy storage, enterprise networking, and carrier marketsUpside risks:Faster-than-anticipated ramp\/visibility in major custom ASIC projectsContinued growth in the DSP-based pluggable market versus new LPO\/LRO techsShare gains in emerging AEC\/CPO\/scale-up switch markets against incumbents<\/p>\n
Related: 5-star analyst sets jaw-dropping Nvidia stock price target<\/p>\n
#Bank #America #resets #Marvell #stock #price #target #earnings<\/p>\n","protected":false},"excerpt":{"rendered":"
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