What's Wall Street Saying About Marvell Technology?

Marvell Technology Group Ltd. (NASDAQ: MRVL) announced its Q4 earnings Thursday.

The company reported Q4 EPS $0.25, above estimates of $0.24. Revenue came in at $857 million, below analyst estimates of $890 million.

Marvell also guided below analyst expectations for Q1 with adjusted EPS in the range of $0.17-$0.19, versus the consensus of $0.22.

The stock reacted by declining in the pre-market but opened higher on Friday.

Wall Street analysts responded to the news. Below are highlights along with current ratings and price targets.

Credit Suisse - Neutral, $16 Price Target

“Our Neutral rating on Marvell reflects our view that while MRVL has done well to outperform the underlying Storage market, and show growth potential in M&W, valuation has become less attractive and long term profitability remains in question given the outsized dependence on M&W to drive growth. Specifically, we expect (1) Storage to grow modestly as share gains and SSD traction offset a lackluster unit growth environment, (2) Networking to remain stable but less impactful at only 19 percent of revenue and (3) competitive/profit pressure within Mobile & Wireless despite expectations of growth in the China TD market. While product drivers remain muted, MRVL does maintain a solid balance sheet with net cash per diluted share of $4.56 – cash represents ~30 percent of market cap.”

Deutsche Bank - Hold, $15 Price Target

“Marvell’s Mobile & Wireless segment disappointed for a third consecutive quarter, as LTE is rapidly becoming as price competitive as was 3G. While investors hope for structural change as investment costs remain high, the company remains committed to the business aiming to gain China LTE market share in FY16. As MRVL is committed to weathering the storm, we fear that M&W would have to decline significantly from here before structural changes are made. Consequently we maintain our Hold rating.”

Oppenheimer - Underperform, No Price Target

“While MRVL's still optimistic about its LTE baseband prospects, we remain skeptical as material pricing pressure compounds a lack of scale needed to compete with high volume incumbents QCOM and MTK. Additionally, Networking falls prey to BRCM's enterprise switching success. Despite modest 4Q share repos, MRVL's $1.5B patent litigation overhang likely caps any shareholder returns near term. With a lack of obvious catalysts NT, we remain sellers.”

Brean Capital - Buy, $17 Price Target

“We believe there is significant upside to MRVL shares if a JV or sale of the baseband business were to be executed. However, until that event occurs, to derive our price target we will apply a sub-average multiple to the P&L similar to the multiples the company has carried historically. We do anticipate a negative reaction in the shares from the guidance miss, but believe the dip will ultimately be reviewed as a buying opportunity considering the 2 potential positive catalysts: 1) CMU litigation, and 2) sale, partnership, or exit of basebands.”