Deutsche Bank Raises Marvell Price Target to $240

Deutsche Bank analyst Ross Seymore raised the price target on Marvell Technology (NASDAQ: MRVL) to $240.00 (from $120.00) while maintaining a Buy rating.

“MRVL’s F1Q report/F2Q guide were both solid yet again, with the co’s typical slight beat in F1Q further bolstered by a “raise” in F2Q (+12% q/q vs DBe +8%) as Data Center (DC) revenues led the way in both quarters.

Perhaps more important than the report/guide was the company increasing its FY27/FY28 revenue expectations, with FY27 revenues now guided up +40% y/y versus +30% y/y prior (with DC growing +50% y/y inclusive of I/O growth of +>70% y/y and Custom growth of +20% y/y) and FY28 revenues growing +45% y/y versus +40% y/y prior (Custom expected to ~>2x y/y as the primary % driver, with a potentially conservative outlook for I/O growth to slow y/y).

On the margin front, GM was slightly better in both the qtr and guide, albeit with the impact from Custom revs ramping likely much more acute in FY28/29.

Importantly, the co is pledging opex discipline to yield strong OM% leverage over the next two years (~35% currently to ~40%).

We continue to view MRVL’s as possessing a relatively rare combination of technology IP (SerDes, optical I/O, compute, etc.) and go-to-market flexibility (merchant & custom) that should enable the company to capitalize on the continued AI megatrend.

Consequently, with our FY29 (CY28) EPS ests rising by ~+20%, we maintain our Buy rating and raise out P/T to $240 (~25x CY28E EPS).”

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