Marvell Technology Inc: 5G Stock Up 60% YOY & Set to Keep Rising

Wall Street Analysts Say Marvell Stock Has 50% Upside

Marvell Technology Inc (NASDAQ:MRVL) is one of the best unsung 5G stocks going. With a market cap of $75.1 billion, it’s not as if Marvell is overlooked or under the radar; it just doesn’t hog the limelight like some big 5G companies do.

Marvell’s financial numbers should certainly be attracting a lot of attention, though. In the second and third quarters of fiscal 2022, the company announced record revenues. It also provided strong guidance for the fourth quarter and full year.

Marvell Technology Inc’s wonderful financial results have helped propel MRVL stock considerably higher. As of this writing, Marvell stock is up by:

  • 25% over the last three months
  • 46% over the last six months
  • 60% year-over-year

With Wall Street, everything is relative. Bragging about a 25% gain is fine, but not if the broader market is up by 40%. Even here, MRVL stock comes out on top. Over the last two years, Marvell stock has rallied by 197.%.

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Over the same time frame, the S&P 500 has only gained 41.1%, First Trust Indxx NextG ETF (NASDAQ:NXTG) has climbed by 49.3%, and Invesco QQQ Trust Series 1 (NYSE:QQQ)—the exchange-traded fund (ETF) holding the most shares of MRVL stock—has gone up by 73.5%.

Wall Street says Marvell stock still has plenty of room to run. Of the analysts providing a 12-month forecast for Marvell Technology Inc, their average estimate is $102.67 and their high estimate is $120.00. That points to potential gains of 30.5% and approximately 50%, respectively.

Chart courtesy of StockCharts.com

About MRVL Stock

Marvell is a data infrastructure semiconductor company that moves, stores, processes, and secures data. Its five end markets are Data Center, Carrier Infrastructure, Enterprise Networking, Consumer, and Automotive/Industrial. (Source: “Marvell Technology, Inc. Reports Third Quarter of Fiscal Year 2022 Financial Results,” Marvell Technology Inc, December 2, 2021.)

Marvell’s connective infrastructure technology has really come to prominence during the COVID-19 pandemic, which has seen the demand for data, bandwidth, power efficiency, and cybersecurity soar.

COVID-19 aside, industry demand for 5G technology, which is still in its infancy, has put pressure on companies like Marvell Technology Inc to create semiconductors that can reliably power energy-hog data centers and communications networks around the world. This, in turn, means billions of people can depend on their online connections.

Record Third-Quarter Results

For the third quarter of fiscal 2022 ended October 30, 2021, Marvell Technology Inc announced that its net revenue increased by 61% year-over-year to a record $1.2 billion. This exceeded the midpoint of the company’s previously announced guidance range. (Source: Ibid.)

Its revenue grew substantially in each of the company’s five end markets, led by Data Center (its largest contributor, at 41% of the company’s total revenue), which grew its revenue by 15% sequentially and 109% year-over-year.

Marvell Technology Inc reported a third-quarter 2022 net loss of $63.0 million, or $0.08 per share. Its adjusted net income was $364.0 million, or $0.43 per share, compared to $283.0 million, or $0.34 per share, in the same prior-year period.

Business Outlook

For the fourth fiscal quarter of 2022, Marvell Technology Inc expects to report:

  • Net revenue of approximately $1.3 billion
  • Diluted net loss of $0.03 per share, plus or minus $0.04 per share
  • Adjusted net income of about $0.48 per share, plus or minus $0.03 per share

Matt Murphy, Marvell Technology Inc’s president and CEO, said, “For the fourth quarter, we are expecting sequential revenue growth of 9 percent at the midpoint of guidance, led by 5G, which is projected to increase by 30 percent sequentially and data center which is forecasted to continue to grow in the double digits on a percentage basis.” (Source: Ibid.)

Analyst Take

The universe of data is rapidly evolving and growing, driven by new applications in artificial intelligence/machine learning, blockchain, Internet of Things, the Metaverse, smart video, and more—all powered by the cloud.

Marvell Technology Inc is at the forefront of the rapidly growing cloud data infrastructure and 5G markets. The numbers speak for themselves, which means Marvell stock could keep surging.