JPMorgan reiterated an Overweight rating and $70 price target on Marvell Technology (NASDAQ:MRVL) Thursday, stating they continue to believe the market is underestimating the company's potential.
"The market underestimates the numerous and diverse product cycles across Marvell's cloud networking/storage/compute semiconductor franchises, which are highly levered to the strong multi-year spending trends from cloud/hyperscaler," wrote analysts.
"We believe the team can continue to drive a strong 20-30% + cloud silicon CAGR over the next several years," they added.
The analysts pointed to factors such as the recent surge in AI workloads driving even more focus on faster networking connectivity, compute/security offload, and the introduction of newer technologies like AEC, co-packaged electro/optical solutions, and CXL for more optimized/customized memory/storage architectures, as reasons they are positive on the stock.
They added that Marvell is the number 2 share leader in custom ASICs with 15% and "has a cumulative leading-edge ASIC design win portfolio of over 40 5nm wins spread across AI/DPU/video transcode/networking/ARM server CPU/automotive/5G."