1. Marvell Technology Inc (NASDAQ:MRVL)
Number of Hedge Fund Investors: 87
Answering a question about Marvell in a latest program, Cramer said that Matt Murphey (MRVL CEO) has a “division that’s unbelievable and the other one that’s not.” Cramer thinks the “unbelievable” vision of Marvell “continues to get” better and the latter is showing improvement.
“Therefore you should hold on to it.”
Marvell Technology Inc (NASDAQ:MRVL) is another stock JPMorgan believes could “dominate” the customer application-specific integrated circuit, or ASIC, market. Analysts at JPMorgan estimate that Marvell Technology Inc (NASDAQ:MRVL) could generate between $1.6 billion and $1.8 billion in AI revenue from ASICs and networking this year and between $2.8 billion and $3 billion next year.
Marvell Technology Inc (NASDAQ:MRVL) shares recently tumbled following mixed Q1 results. However, some analysts believe the stock could be an opportunity to buy on the dip. Oppenheimer analyst Rick Schafer maintained his outperform rating on the stock and upped his price target to $90 from $80.
Analysts believe that Marvell Technology Inc. (NASDAQ:MRVL) could be the next major AI play as Marvell Technology Inc. (NASDAQ:MRVL) begins to roll out AI-specific products like Spica™ 800G PAM4 DSP platform for optical interconnects. Marvell Technology Inc. (NASDAQ:MRVL) also sells Application-specific integrated circuits (ASICs) for data centers, which are seeing a huge boost amid the AI revolution.
According to data compiled by Yahoo Finance, average Wall Street price target for Marvell Technology Inc. (NASDAQ:MRVL) is $87.7, which represents a 14% upside potential from the current levels.
However, Marvell Technology Inc’s (NASDAQ:MRVL) negative revenue growth has alarmed many especially when peers are growing at a faster pace. In the first quarter, revenue fell 12.2% on a YoY basis. Marvell Technology Inc (NASDAQ:MRVL) has a $3 billion of net debt. In fiscal 2025, Marvell Technology Inc’s (NASDAQ:MRVL) FCF is expected to come in at $1 billion, excluding taxes and management’s stock options. While the stock’s PE ratio (TTM) is 52, it’s trading at 32X 2025 EPS estimate. This makes Marvell Technology Inc. (NASDAQ:MRVL) a stock to consider only for the long-term. In the short-term there are much better options to invest in the AI space other than Marvell Technology Inc. (NASDAQ:MRVL).
While we acknowledge the potential of Marvell Technology Inc (NASDAQ:MRVL) , our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than Marvell Technology Inc (NASDAQ:MRVL) but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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