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Marvell Stock Leaps on Q3 Report; Goldman Upgrades to Buy

Marvell's adjusted profit totaled 43 cents a share for the latest quarter, topping the FactSet analyst consensus of 38 cents.
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Marvell Technology  (MRVL) - Get Marvell Technology, Inc. Report shares leaped Friday after the semiconductor maker reported stronger-than-expected results for the latest quarter and topped estimates for guidance.

For the fiscal 2022 third quarter ended Oct. 30, the company registered a loss of 8 cents a share, widening from a loss of 3 cents a share in the year-earlier quarter.

Adjusted profit totaled 43 cents a share, up from 25 cents a share a year earlier and above the FactSet analyst consensus of 38 cents.

Revenue soared 61% to $1.21 billion from $750.1 million, topping the analyst forecast of $1.15 billion for the latest quarter.

For the fiscal fourth quarter, Marvell anticipates adjusted EPS of 45 cents to 51 cents and revenue of $1.28 billion to $1.36 billion. 

Analysts predicted adjusted EPS of 42 cents and revenue of $1.21 billion.

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The stock recently traded at $84.49, up 19%, after soaring 49% year to date through Thursday.

Goldman Sachs upgraded Marvell to buy from neutral.

“We acknowledge that staying on the sidelines has been the wrong call, ... as we underestimated the inflection in the company’s fundamentals as well as the attractiveness of the stock’s valuation relative to the broader sector,” Goldman analysts wrote, according to CNBC.

Morningstar analyst William Kerwin was impressed, too.

“Marvell Technology reported blistering fiscal-third-quarter results, exceeded only by even stronger guidance for the fiscal fourth quarter and fiscal 2023,” he wrote Thursday.

“We’re raising our fair value estimate for the no-moat fabless chip designer to $62 per share, from $50, behind greater confidence in design win momentum generating above-market growth in the long term.

“We continue to believe Marvell has a comprehensive portfolio for cloud data infrastructure, and think it is sharply capitalizing on secular trends toward high-speed clouds and 5G networks to win market share across its technologies.”