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Marvell (MRVL) to Report Q3 Earnings: What's in the Offing?
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Marvell Technology Group Ltd. (MRVL - Free Report) is set to report third-quarter fiscal 2021 results on Dec 3.
The company projects revenues of $750 million (up or down up to 5%) for the quarter. The Zacks Consensus Estimate for revenues is pegged at $750.4 million, suggesting growth of 13.3% from the year-ago period.
Marvell expects non-GAAP earnings per share between 22 cents and 28 cents. The consensus mark of 25 cents indicates a 47.1% increase, year over year.
Notably, Marvell's guidance for the fiscal third quarter takes into account the U.S. government's export restriction on certain Chinese customers. The company’s wider guidance range for revenues and earnings also reflects the uncertainties associated with the coronavirus pandemic.
The company surpassed the Zacks Consensus Estimate in all of the trailing four quarters, the average surprise being 10%.
Factors to Consider
Marvell is likely to have benefited from strong demand for its networking products mainly across the data-center and 5G infrastructure end markets. Solid 5G deployments in China are anticipated to have aided the company’s overall performance.
Additionally, last year’s acquisitions of Avera and Aquantia are projected to have driven Marvell’s networking segment revenues during the quarter under review. Aquantia’s solid pipeline of design wins is likely to have been a positive as well. The consensus mark for networking revenues is pegged at $432 million, calling for growth of 30.9% year over year and 6.4% sequentially.
However, the storage business might have been weak during the quarter to be reported. During its second-quarter earnings conference call, Marvell had forecasted significant sequential decline in the Fiber Channel business due to softness in enterprise server and storage system demand amid the COVID-19 pandemic.
The decline in Fiber Channel sales is expected to have offset benefits from improvement in the storage controller business. The company had projected storage controller sales to be up quarter on quarter mainly on the continued ramp-up of customized SSD controller, partially offset by soft drive demand from enterprise data centers and some edge applications.
The Zacks Consensus Estimate for storage business revenues is pegged at $290 million, indicating a slight improvement from the year-ago quarter’s $288 million but a marginal decline from the previous quarter’s $291 million.
What Our Model Says
Our proven model does not predict an earnings beat for Marvell this season. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Marvell currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat this quarter:
Toronto Dominion Bank (TD - Free Report) has an Earnings ESP of +3.63% and holds a Zacks Rank of 2, at present.
The Kroger Co. (KR - Free Report) has an Earnings ESP of +0.38% and carries a Zacks Rank of 2, currently.
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Marvell (MRVL) to Report Q3 Earnings: What's in the Offing?
Marvell Technology Group Ltd. (MRVL - Free Report) is set to report third-quarter fiscal 2021 results on Dec 3.
The company projects revenues of $750 million (up or down up to 5%) for the quarter. The Zacks Consensus Estimate for revenues is pegged at $750.4 million, suggesting growth of 13.3% from the year-ago period.
Marvell expects non-GAAP earnings per share between 22 cents and 28 cents. The consensus mark of 25 cents indicates a 47.1% increase, year over year.
Marvell Technology Group Ltd. Price and Consensus
Marvell Technology Group Ltd. price-consensus-chart | Marvell Technology Group Ltd. Quote
Notably, Marvell's guidance for the fiscal third quarter takes into account the U.S. government's export restriction on certain Chinese customers. The company’s wider guidance range for revenues and earnings also reflects the uncertainties associated with the coronavirus pandemic.
The company surpassed the Zacks Consensus Estimate in all of the trailing four quarters, the average surprise being 10%.
Factors to Consider
Marvell is likely to have benefited from strong demand for its networking products mainly across the data-center and 5G infrastructure end markets. Solid 5G deployments in China are anticipated to have aided the company’s overall performance.
Additionally, last year’s acquisitions of Avera and Aquantia are projected to have driven Marvell’s networking segment revenues during the quarter under review. Aquantia’s solid pipeline of design wins is likely to have been a positive as well. The consensus mark for networking revenues is pegged at $432 million, calling for growth of 30.9% year over year and 6.4% sequentially.
However, the storage business might have been weak during the quarter to be reported. During its second-quarter earnings conference call, Marvell had forecasted significant sequential decline in the Fiber Channel business due to softness in enterprise server and storage system demand amid the COVID-19 pandemic.
The decline in Fiber Channel sales is expected to have offset benefits from improvement in the storage controller business. The company had projected storage controller sales to be up quarter on quarter mainly on the continued ramp-up of customized SSD controller, partially offset by soft drive demand from enterprise data centers and some edge applications.
The Zacks Consensus Estimate for storage business revenues is pegged at $290 million, indicating a slight improvement from the year-ago quarter’s $288 million but a marginal decline from the previous quarter’s $291 million.
What Our Model Says
Our proven model does not predict an earnings beat for Marvell this season. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Marvell currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat this quarter:
Signet Jewelers Limited (SIG - Free Report) has an Earnings ESP of +13.95% and carries a Zacks Rank of 2, currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
Toronto Dominion Bank (TD - Free Report) has an Earnings ESP of +3.63% and holds a Zacks Rank of 2, at present.
The Kroger Co. (KR - Free Report) has an Earnings ESP of +0.38% and carries a Zacks Rank of 2, currently.
Legal Marijuana: An Investor’s Dream
Imagine getting in early on a young industry primed to skyrocket from $17.7 billion in 2019 to an expected $73.6 billion by 2027.
Although marijuana stocks did better as the pandemic took hold than the market as a whole, they’ve been pushed down. This is exactly the right time to get in on selected strong companies at a fraction of their value before COVID struck. Zacks’ Special Report, Marijuana Moneymakers, reveals 10 exciting tickers for urgent consideration.
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