Marvell Technology Has Analysts Bullish Following Earnings Beat, Strong Guidance

Marvell was the subject of numerous, mostly bullish notes, following its surprise fiscal fourth quarter beat and strong guidance.

Marvell Technology  (MRVL) - Get Report was the subject of numerous mostly positive analyst notes on Thursday after the company reported fiscal fourth quarter results and first-quarter guidance that were unexpectedly strong.

Shares were rising almost 11% to $25.05 on Thursday morning. 

Analysts at Jefferies reiterated their buy rating while saying that the company has consolidated the merchant and custom silicon market for 5G. “We expect it be a primary beneficiary of the 5G network buildout," analysts wrote. 

Jefferies also noted that the stock has underperformed the wider market by 37% since June 2019, making it undervalued.

Meanwhile, at Barclays, Marvell is the firm’s top pick in the sector as the company reported strong guidance for its fiscal first quarter despite the coronavirus outbreak.

“The company is well positioned to benefit from secular growth drivers with the best 5G exposure in the group. Although storage is weak, MRVL diversification efforts should help drive a re-rating as a diversified communication semiconductor company,” analyst Blayne Curtis wrote.

Analysts at JPMorgan also were impressed with the company’s quarter as the company drove 3% sequential revenue growth in its storage segment, while networking revenue rose 14% sequentially.

“We believe the Networking business is starting to see improving demand trends from the enterprise/cloud datacenter networking markets with continued strength in the 5G ramp into Samsung and Ericsson (Avera ASICs),” analyst Harlan Sur said. The firm reiterated its overweight rating.

Morgan Stanley reiterated its equal-weight rating, but raised its price target to $25 from $24 per share. The firm expected Marvell to weather the coronavirus storm.

“Given that Marvell's exposures are largely infrastructure oriented, we didn't expect that magnitude of headwind -- that is similar to what companies much more exposed to demand destruction are seeing -- but various supply challenges out of China are creating that impact,” the firm wrote. 

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