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Marvell Technology (MRVL) Gains As Market Dips: What You Should Know

Zacks Equity Research
·3 mins read

In the latest trading session, Marvell Technology (MRVL) closed at $43.78, marking a +0.44% move from the previous day. This change outpaced the S&P 500's 0.63% loss on the day. Elsewhere, the Dow lost 0.55%, while the tech-heavy Nasdaq lost 0.1%.

Prior to today's trading, shares of the chipmaker had gained 11.14% over the past month. This has outpaced the Computer and Technology sector's gain of 8.45% and the S&P 500's gain of 5.91% in that time.

Wall Street will be looking for positivity from MRVL as it approaches its next earnings report date. The company is expected to report EPS of $0.25, up 47.06% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $750.23 million, up 13.25% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.92 per share and revenue of $2.96 billion, which would represent changes of +39.39% and +9.55%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for MRVL. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. MRVL is currently a Zacks Rank #3 (Hold).

In terms of valuation, MRVL is currently trading at a Forward P/E ratio of 47.34. Its industry sports an average Forward P/E of 35.38, so we one might conclude that MRVL is trading at a premium comparatively.

We can also see that MRVL currently has a PEG ratio of 2.21. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Semiconductor - Communications stocks are, on average, holding a PEG ratio of 9.22 based on yesterday's closing prices.

The Semiconductor - Communications industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 125, putting it in the top 50% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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Zacks Investment Research