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Marvell (MRVL) reported its Q4 earnings on March 5. The stock closed 18.35% higher at $89.57 on the next day, according to Yahoo Finance.<\/p>\n
The stock soared thanks to the strength of the report, but also because it proved that the rumors about the company losing its key customers were not true. I wrote about how the stock lost a lot of value thanks to these rumors in my article \u201c5-star analyst resets Marvell forecast before earnings.\u201d<\/p>\n
Investors interested in Marvell are probably also interested in how Broadcom, its main competitor, is doing. I covered Broadcom\u2019s earnings in my article \u201cMorgan Stanley resets Broadcom price target after earnings.\u201d<\/p>\n
Marvell Q4 earnings highlights:Record net revenue of $2.219 billion, a 22% year-over-year increase GAAP gross margin of 51.7%GAAP diluted income per share $0.46<\/p>\n
Important products in Marvell\u2019s vast tech portfolio are Data Center Interconnect (DCI) Modules, which are used to transmit data over regional fiber networks.<\/p>\n
\u201cWe are winning new customers and expect to supply DCI modules to all five major U.S. hyperscalers this year,” Marvell Chairman and CEO Matt Murphy said during the earnings call, describing the company’s progress. <\/p>\n
“We see significant long-term growth in this market as the global data center footprint expands and bandwidth requirements between data centers continue to increase,” Murphy added.<\/p>\n
\u201cIndustry forecasts project the DCI pluggable [total addressable market] to grow by more than 5x by calendar 2030, with speeds doubling each generation and feature complexity increasing, including the integration of [Media Access Control Security (MACsec)].\u201d <\/p>\n
Marvell outlook for Q1 fiscal 2027:Net revenue of $2.4 billion +\/- 5%GAAP gross margin in the range of 51.4% to 52.4%GAAP diluted net income per share of $0.31 +\/- $0.05 per share<\/p>\n
Goldman Sachs raises its Marvell price target and EPS estimates.<\/p>\n
Shutterstock<\/p>\n
Goldman Sachs raises Marvell price target<\/p>\n
Following the report\u2019s release, Goldman Sachs analyst James Schneider and his team updated their view on Marvell stock. <\/p>\n
The analysts said they see Marvell\u2019s results as an incremental medium-term positive for the stock, given increased visibility into medium-term fundamentals.<\/p>\n
Related: Bank of America resets Amazon stock forecast<\/p>\n
They noted that the company expects some level of gross margin dilution due to its custom silicon product mix. The team estimates that the company will see approximately 0.25% quarter-over-quarter (QoQ) gross margin erosion through calendar year 2026, and approximately 0.5% QoQ erosion in calendar year 2027.<\/p>\n
Analysts raised their EPS estimates for 2026-2028 EPS by an average of 16%, driven by higher revenues and partially offset by lower gross margin assumptions.<\/p>\n
EPS estimates (excluding stock-based compensation):<\/p>\n
Year<\/p>\n
2026<\/p>\n
2027<\/p>\n
2028<\/p>\n
New EPS estimate<\/p>\n
$3.8<\/p>\n
$5.25<\/p>\n
$7.0<\/p>\n
Old EPS estimate<\/p>\n
$3.4<\/p>\n
$4.5<\/p>\n
$5.85<\/p>\n
In a research note shared with me, Schneider reiterated a neutral rating for Marvell stock and increased the target price to $100 from $90.<\/p>\n
Analysts noted downside risks for Marvell:Slowdown in overall AI spendingShare loss in custom computeUpside risks:Stronger-than-expected ramp in custom computeStronger-than-expected recovery in traditional businessesMarvell improves its DCI technology<\/p>\n
The forecast Murphy provided during the DCI earnings call also unveiled impressive improvements for the tech.<\/p>\n
The company expanded its multi-generational ZR\/ZR+ and coherent digital signal processor (DSP) technology portfolio. It launched COLORZ 1600, the industry\u2019s first 1.6 Tbps ZR\/ZR+ DCI pluggable and 2nm coherent DSPs featuring MACsec.<\/p>\n
More Tech Stocks:<\/p>\n
Morgan Stanley sets jaw-dropping Micron price target after eventNvidia\u2019s China chip problem isn\u2019t what most investors thinkQuantum Computing makes $110 million move nobody saw coming<\/p>\n
COLORZ 1600, with the Electra coherent DSP, enables connecting campus (20km), metro (120km), and regional (1,000km) data centers at 1.6 Tbps.<\/p>\n
\u201cMarvell, in close collaboration with hyperscale customers, introduced the first ZR pluggable nearly a decade ago and has continued to set the pace for every generation of coherent technology,\u201d said Russ Esmacher, senior vice president and general manager, Data Center Interconnect at Marvell.<\/p>\n
\u201cMarvell has a proven track record of consistently delivering first-to-market advancements across multiple generations of coherent DSPs, and the company\u2019s move to 2nm solutions underscores its commitment to density, performance, and power,\u201d added Cignal AI Lead Analyst Scott Wilkinson. <\/p>\n
Related: Apple\u2019s latest product is a game-changer<\/p>\n
#Goldman #Sachs #resets #Marvell #price #target #earnings<\/p>\n","protected":false},"excerpt":{"rendered":"
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