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On Thursday, CFRA analyst Angelo Zino revised the price target for Marvell Technology Group Ltd . (NASDAQ:MRVL) shares, bringing it down to $90 from the previous $130 while maintaining a Strong Buy rating on the stock. The stock currently trades at $72.73, having declined 18.35% year-to-date despite showing strong momentum with a 36.35% gain over the past six months. The adjustment reflects a new valuation based on a reduced peer premium price-to-earnings (P/E) ratio of 25 times the firm’s calendar year 2026 earnings per share (EPS) estimate. This change takes into account Marvell’s higher growth prospects in AI infrastructure and the increasing risks in the market. According to InvestingPro data, the company currently trades at high EBITDA and revenue valuation multiples, with an EV/EBITDA ratio of 81.89x, suggesting premium pricing for its growth potential.
Zino’s valuation compares to Marvell’s historical forward average P/E ratios of 31.9x for the past three years and 33.5x over the past five years. Despite the price target reduction, CFRA’s EPS estimates for the fiscal year 2025 ending in January remain at $2.76, and for fiscal year 2026 at $3.72. The analyst expressed optimism about Marvell’s trajectory, particularly highlighting the company’s success in custom silicon.
Marvell’s partnership with Amazon (NASDAQ:AMZN) is one of the key factors driving the company’s new growth phase, characterized by a significant increase in the volume production of custom silicon programs. While currently not profitable over the last twelve months, InvestingPro analysis indicates that net income is expected to grow this year, with analysts predicting a return to profitability. Get access to 10+ additional exclusive ProTips and comprehensive financial analysis through InvestingPro’s detailed research reports. Additionally, Marvell’s AI connectivity and optics revenues are experiencing robust bookings growth, which is expected to continue. The growth is supported by product advancements, including a transition to 3-nanometer 1.6T offerings that promise a 20% improvement in energy efficiency and power consumption compared to previous products.
The analyst also noted a recovery in Marvell’s non-AI revenue, although at a slower pace. This diversified progress across different segments of Marvell’s business contributes to the company’s overall growth prospects and supports the strong buy rating, despite the lowered price target. The company maintains a healthy financial position with a moderate debt level and strong cash flow metrics, earning a "FAIR" overall Financial Health score from InvestingPro. Discover detailed valuation analysis and growth projections in the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Marvell Technology Group Ltd. reported financial results that exceeded expectations but offered guidance that fell short of investor anticipation. This led to several analyst firms adjusting their price targets. Jefferies reduced its target from $120 to $100 while maintaining a Buy rating, citing Marvell’s strategic steps in the 3nm semiconductor space. Benchmark kept its Buy rating with a $135 target, noting that Marvell’s modest guidance was slightly above consensus, despite a sharp share decline. Cantor Fitzgerald also adjusted its price target from $160 to $125, maintaining an Overweight rating and highlighting the company’s AI revenue growth potential.
Meanwhile, TD Cowen lowered its price target to $95 but continued to support a Buy rating, emphasizing Marvell’s effective execution despite a challenging market environment. William Blair maintained an Outperform rating, focusing on Marvell’s AI market momentum and partnerships with major tech companies like Amazon and Microsoft (NASDAQ:MSFT). Marvell’s partnership with Amazon, particularly for the Trainium 3 project, remains a critical element of its growth strategy. The company’s data center and networking divisions have also shown substantial growth, with new product developments expected in fiscal 2026.
These developments indicate Marvell’s ongoing commitment to innovation and expansion, particularly in the AI and semiconductor sectors.
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