Marvell Technology (MRVL) stock soared over 6.5% in premarket trading on Tuesday, propelled by a wave of analyst upgrades and bullish price target revisions ahead of its fiscal earnings report on Wednesday, May 27. The chipmaker, already up 124% since late March, is benefiting from what HSBC analyst Frank Lee described as an AI networking “supercycle,” with optical interconnects expected to drive revenue far beyond current consensus estimates.
HSBC upgraded MRVL to Buy and dramatically raised its price target to $300 from $85, citing Marvell’s dominant position in 800G and 1.6T digital signal processors essential for AI data center expansion. Susquehanna lifted its target to $230 from $100 while maintaining a Positive rating, and Morgan Stanley raised its target to $172 from $103. All three firms see momentum from Marvell’s custom XPU and optical interconnect businesses, with Susquehanna highlighting Amazon’s revised $218 billion capex forecast and a new Anthropic compute agreement as major catalysts for the Trainium platform.
Marvell’s revenue is projected to hit $2.4 billion in the April quarter, a 26% year-over-year increase, with earnings per share expected to rise 27% to 79 cents. The company also recently closed its $3.5 billion acquisition of Celestial AI, aiming to surpass $10 billion in annual revenue this fiscal year. However, valuation concerns linger: the stock trades at a forward P/E of 98, well above the S&P 500 average, and it has deviated significantly from its 100-day moving average, with an RSI showing a bearish divergence.
The broader AI theme continues to lift tech stocks, though Marvell’s upcoming report will be closely watched for guidance on the July quarter and any supply constraints on 3-nanometer chips.
