© Reuters. Marvell Technology’s (MRVL) assessment is “compelling” – BofA
By Sam Boughedda
BofA said Friday that Marvell Technology’s (NASDAQ:) valuation was “compelling” despite macro headwinds.
Analysts there reiterated a buy rating and a price target of $65 per share on the stock, saying cloud, 5G and autos can “compensate for tougher businesses.”
“Our new baseline/published model now forecasts FY24/CY23 MRVL sales to grow 5% YoY to approximately $6 billion, down from $6.9 billion (+13% YOY) previously, and well below consensus at $7.1B (+15% YOY).We expect MRVL’s cloud-optimized gains to deliver double-digit growth in data centers, but this could be offset by double-digit declines in enterprise networks, where the 40%+ growth rate this year is unsustainable. US/India, plus market share gains to drive carrier growth,” the analysts wrote.
In the short term, BofA believes the three growth peers Marvell, Nvidia (NASDAQ:) and Advanced Micro Devices (NASDAQ:) are “exposed to all cloud/enterprise customer announcements/investment announcements.”
“The continued correction of the semis is likely to ripple from consumer to enterprise and data center. This is driving our proactive estimate reductions. However, once the consensus reflects this scenario (likely at during the upcoming CQ3 earnings season), we believe the stock can recover as valuations, particularly for MRVL, look compelling,” the analysts added.