UBS Reiterates Buy Rating on Marvell (March 12)

UBS analyst Timothy Arcuri reiterated a Buy rating and $120.00 price target on Marvell Technology (NASDAQ: MRVL).

“We emerge from two days of investor meetings w/mgmt confident that MRVL’s targets (including $15B revenue in F2028/C2027) are conservative with several key pockets of upside including: 1) custom ASIC (a conservative assumption for both the MSFT ramp (we think) and XPU attach (many of which are big die w/ASP of several $k); 2) the interconnect segment (~44% of revenue) where MRVL is baking in hyperscale capex growth of only ~15-20% next year; 3) the transition to optical interconnect for XPU/XPU (driven by its lead hyperscale customer starting in ’27); and 4) switch/storage – a relatively small piece of revenue, but inflecting upward.

Overall, we continue to believe many investors are too focused on high profile custom XPU programs (AMZN/MSFT (we think)) and many view these through too much of an “all or nothing” lens.

We think this is missing the nuances around the various ways MRVL can shift its strategy to meet customer’s ASIC needs as well as the sheer breadth of custom opportunities at these large hyperscalers.

We maintain our C2027 EPS at ~$5.41 and PT at $120, based on a 23x P/E multiple.”

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