Marvell Technology's Upbeat Outlook Led by Optical Business, RBC Says

MT Newswires Live03-07

Marvell Technology (MRVL) has projected an upbeat outlook for fiscal 2027 and 2028 on the back of a strong optical business momentum, RBC said in a research report Friday, boosting the semiconductor producer's EPS estimates.

The company sees year-on-year growth of 33% and 37% for fiscal 2027 and 2028, compared with the investment firm's expectations of 22% and 33%, respectively.

RBC raised its 2027 EPS estimate to $3.84 from $3.32 and also lifted its 2028 EPS expectation to $5.51 from $4.72.

The company's optical connectivity is benefitting from demand due to strong generative artificial intelligence adoption and expanding cluster sizes, the firm said. Demand for 800G PAM4 digital signal processor also continues to be strong, it added.

Analysts at the brokerage said Marvell management's forecast that its custom XPU business will double in fiscal 2028 does not seem "unreasonable."

RBC maintained its outperform rating and raised price target to $115 from $105.

Shares of Marvell Technology rose about 20% in Friday's trading.

Price: 90.99, Change: +15.31, Percent Change: +20.23

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