Marvell Technology's Macro, Inflation Headwinds Prompt 5% Price Target Cut By Citi

Marvell Technology's Macro, Inflation Headwinds Prompt 5% Price Target Cut By Citi
  • Citi analysts Atif Malik and Amanda Scarnati reiterated a Buy on Marvell Technology, Inc MRVL but reduced the price target from $78 to $74.
  • Marvell reported Q2 EPS of $0.57, beating the consensus of $0.56. The revenue of $1.517 billion, up 41% Y/Y, missed the consensus of $1.520 billion.
  • MRVL stock was down 3% after posting a 1% July quarter EPS beat and guiding October quarter 2% below Street. 
  • Data Center sales were flat versus up LSD expectations and guided down 5% Q/Q with the January quarter up Q/Q. 
  • The advanced multi-package supply availability impacted the data center sales. 
  • An upside offset data center sales in enterprise networking due to an improved supply of simple packages. 
  • Marvell has not seen any demand-related data center weakness similar to the comments of data center peers Nvidia Corp NVDA/Advanced Micro Devices, Inc AMD
  • MRVL reiterated $400 million/$800 million of incremental data center sales in the next two years from new design wins. 
  • He cut his CY23 EPS by 5% and CY24 EPS by 7% and trimmed the price target to reflect slower macro and higher inflation-adjusted operating expenditure. 
  • He continues to view MRVL as a multi-year data center growth story. 
  • Price Action: MRVL shares traded lower by 1.79% at $49.27 on the last check Monday.
  • Photo Via Company

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