This news is certainly a big concern, clear by the drastic selling pressure on the stock, Cramer said. While no issues have been reported yet, this is not a positive sign for investors.
It doesn't help that analysts at UBS downgraded Marvell to sell from hold due to the negative impact from the merger betweenSanDisk (SNDK) and Western Digital (WDC) - Get Report . The analysts lowered their price target on Marvel to $6. Shares recently traded at $7.75.
If there are accounting irregularities at Marvell, that is very, very bad, Cramer said. Even after a big drop in the stock, he's thinking sell, sell, sell.
The stock is now down 37% in the past three months and 46% on the year. Many investors have been pointing to a merger as a potential catalyst for Marvell's stock to rise but, he said, the truth is no companies seem to want Marvell.
At the time of publication, Cramer's Action Alerts PLUS had no position in companies mentioned.