Oppenheimer says Marvell Technology could thrive from its exposure to the artificial intelligence trend.
On Monday, analyst Rick Schafer reiterated his Outperform rating on Marvell shares and reaffirmed his $70 price target after meetings with the company's chief financial officer.
"We believe AI-related order velocity [is] still building," Schafer wrote.
Marvell stock rallied by 2.6% Monday to $61.35.
Marvell sells chips and hardware products for the data center, 5G infrastructure, networking, and storage markets. In May, Marvell shares surged after it posted solid earnings results and the company's executives spoke optimistically about its momentum in AI applications.
"While we are still in the early stages of our AI ramp, we are forecasting our AI revenue in fiscal 2024 to at least double from the prior year and continue to grow rapidly in the coming years," Marvell CEO Matt Murphy said in a release at the time.
Schafer said Marvell's new networking products for cloud vendors -- including Google Cloud -- should boost its revenue growth for this year and next year. Marvell's "diverse, structural growth [is] led by share/content gains in cloud/AI, 5G, and auto," he wrote, noting the stock is a top pick.
Wall Street is generally positive on Marvell stock. According to FactSet, 90% of analysts covering the company have ratings of Buy or the equivalent on the shares, while 10% have Hold ratings.
Over the past 12 months, Marvell stock is up 44%, compared with the 24% rise of the Nasdaq Composite.
