Can Marvell Technology's AI Strengths Balance Persistent Industry Headwinds, This Analyst Has Answer
Portfolio Pulse from Anusuya Lahiri
Susquehanna analyst Christopher Rolland maintains a Positive rating on Marvell Technology (MRVL) with a $70 price target, despite expecting in-line earnings and weaker guidance due to industry headwinds. Rolland highlights Marvell's AI strengths, particularly in PAM4 DSPs (Inphi), which benefit from Nvidia's (NVDA) demand. However, challenges in Storage, Carrier, and Networking may offset AI momentum. Other companies like Cisco (CSCO), Intel (INTC), AMD, Arista Networks (ANET), and Juniper Networks (JNPR) have mixed outlooks, with Cisco's guidance notably weaker. Marvell's gross margins are expected to expand in Q4 due to an improved mix.
November 21, 2023 | 6:38 pm
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NEGATIVE IMPACT
Cisco's weaker guidance due to product implementation delays could negatively impact its short-term stock performance.
Cisco's admission of weaker guidance due to implementation delays is a direct negative indicator for its stock price in the short term.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 60
NEGATIVE IMPACT
Intel's subdued outlook, along with other tech firms, may indicate potential challenges ahead for its stock price.
Intel's subdued outlook, as part of a broader trend among tech companies, could lead to negative investor sentiment and pressure on its stock price.
CONFIDENCE 70
IMPORTANCE 50
RELEVANCE 50
NEUTRAL IMPACT
Marvell Technology is expected to have in-line earnings but weaker guidance due to industry headwinds, with AI strengths potentially balancing the impact.
While Marvell faces industry challenges, its AI-related revenue growth and positive analyst rating could support the stock price. However, weaker guidance may temper gains.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 100
POSITIVE IMPACT
Arista Networks saw strength in Enterprise Networking, which could positively influence its stock price in the short term.
Arista Networks' positive performance in Enterprise Networking contrasts with the negative outlook of others, potentially boosting investor confidence.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
POSITIVE IMPACT
Juniper Networks' strength in Enterprise Networking could be a positive driver for its stock price in the short term.
Juniper Networks' positive performance in a challenging environment may lead to favorable investor sentiment and support its stock price.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
POSITIVE IMPACT
Nvidia's demand for DGX/H100 deployments is beneficial for Marvell's AI-related products, indicating a positive outlook for Nvidia.
Nvidia's demand for AI products is a positive sign for its business and suggests continued growth in the AI sector.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70