Strong Chip Demand Fuels Marvell’s 2Q Beat

August 28, 2020

1 minute read

Marvell Technology reported stronger-than-expected 2Q results on Thursday, reflecting strong demand for its networking and storage chips across 5G wireless infrastructure and datacenter end markets.

MRVL) 2Q revenues increased 11% to $727 million year-over-year and surpassed analysts’ expectations of $724.7 million. Its adjusted EPS jumped three-fold to $0.21 from $0.07 in the year-ago quarter mainly benefiting from higher revenues and lower operating expenses. Quarterly earnings also beat Street estimates by a penny.” data-reactid=”13″>Marvell Technology’s (MRVL) 2Q revenues increased 11% to $727 million year-over-year and surpassed analysts’ expectations of $724.7 million. Its adjusted EPS jumped three-fold to $0.21 from $0.07 in the year-ago quarter mainly benefiting from higher revenues and lower operating expenses. Quarterly earnings also beat Street estimates by a penny.

See MRVL stock analysis on TipRanks).” data-reactid=”14″>The company’s CEO Matt Murphy said, “Marvell delivered strong second quarter financial results with revenue above the mid-point of guidance, growing 11% year on year and 5% sequentially. We are expecting revenue growth to continue in the third quarter, driven primarily from 5G wireless infrastructure and cloud datacenter end markets.” (See MRVL stock analysis on TipRanks).

Hans Mosesmann increased the price target to $50 (upside potential of 39.2%) from $42. Mosesmann said that "We are incrementally more bullish on MRVL on eyebrow raising acceleration to 5nm process technology with TSMC that shatters the fast-follower historical moniker, and clever shift to custom ASIC server-class ARM-processor roadmap from standard merchant offerings."” data-reactid=”19″>Following its 2Q earnings, Rosenblatt Securities analyst Hans Mosesmann increased the price target to $50 (upside potential of 39.2%) from $42. Mosesmann said that “We are incrementally more bullish on MRVL on eyebrow raising acceleration to 5nm process technology with TSMC that shatters the fast-follower historical moniker, and clever shift to custom ASIC server-class ARM-processor roadmap from standard merchant offerings.”

He added: “MRVL is well positioned to transition to a secular top-tier semi player in next generation data center (data processing unit or DPU), wired and wireless infrastructure, and storage.” Mosesmann maintains a Buy rating on MRVL stock.

price target of $39.10 implies upside potential of another 10%.” data-reactid=”21″>Currently, MRVL has a bullish Strong Buy analyst consensus. With shares up already 34.6% year-to-date, the average analyst price target of $39.10 implies upside potential of another 10%.