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Marvell (MRVL) Up 84% in 2021: Will the Rally Continue in 2022?
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Marvell Technology (MRVL - Free Report) stock outperformed the Zacks Technology Services industry as well as S&P 500 in 2021. Marvell’s shares surged 84% last year, while the Technology Services industry plunged 43.2%. MRVL stock also surpassed the S&P 500 index’s last year rise of 27.6%.
The stock’s price rally reflects the company’s robust fundamentals. Therefore, if you haven’t taken advantage of the share-price appreciation yet, it’s time for you to add the stock to your portfolio now.
The company performed brilliantly last year and has the potential to continue the momentum in 2022 as well.
Image Source: Zacks Investment Research
What’s Driving Marvell Stock’s Growth?
Marvell specializes in highly integrated system-on-a-chip (SoC) and System-in-a-Package devices, based primarily on ARM Holdings’ designs and sells to both enterprise and consumer customers. It has a significant number of patents in design, software and reference platforms to its credit.
The company is benefiting from solid demand for its storage and networking chips from the 5G infrastructure and data-center end markets. Marvell expects continued growth in 5G-related revenues in the near term, driven by continued deployment in Korea and the beginning of higher 5G adoption in the United States, Japan and other countries.
Moreover, MRVL has inked partnerships with Nokia, Samsung and Analog Devices to enhance its capabilities in the 5G solutions space. In March 2021, Marvell and Samsung jointly developed a SoC for Tier-one cellular operators. Integrated into Samsung’s Massive MIMO radio, the new SoC supports both 4G and 5G networks while reducing chipset power consumption up to 70% more than the previous solutions.
Additionally, last year’s acquisition of Inphi Corporation has opened up new avenues of growth for Marvell. MRVL is a leader in infrastructure semiconductor products, while Inphi makes high-speed data movement systems. Therefore, the transaction will broaden Marvell's leadership in data centers and extend its 5G network infrastructure.
Inphi's growing presence with cloud customers will also open additional opportunities for Marvell's DPU and ASIC products. The deal is likely to generate annual run-rate synergies of $125 million, which are to be realized within 18 months after the transaction‘s conclusion. It will also be accretive to Marvell's non-GAAP earnings per share (EPS) by the end of the first year after the deal’s closure.
Solid Growth Expectations
The Zacks Consensus Estimate of $1.55 per share for fiscal 2022 earnings suggests growth of approximately 68.5% from the year-ago period. For fiscal 2023, the consensus mark for earnings is pegged at $2.21, indicating a year-over-year increase of 42.6%. The long-term EPS growth rate is estimated at 24.3%.
Marvell has an impressive earnings surprise history. The company has outpaced estimates in three of the trailing four quarters while meeting the same on one occasion, delivering an average earnings surprise of 7.6%.
Analysts have raised the estimates for fiscal 2022 and 2023 over the past 30 days, reflecting their confidence in the company. During the same period, the Zacks Consensus Estimate for fiscal 2022 and 2023 has moved 10 cents and 30 cents north, respectively.
The Zacks Consensus Estimate for Apple’s first-quarter fiscal 2022 earnings has been revised upward by a penny to $1.25 per share over the past 60 days. For fiscal 2022, earnings estimates have moved upward by five cents to $5.82 per share in the past 30 days.
Apple’s earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while meeting the same on one occasion, the average surprise being 22.3%. AAPL stock gained 33.8% in 2021.
The Zacks Consensus Estimate for Broadcom’s first-quarter fiscal 2022 earnings has been revised upward by 8.1% to $8.15 per share over the past 30 days. For fiscal 2022, earnings estimates have moved upward by 6.5% to $33.03 per share over the past 30 days.
Broadcom’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 1.4%. Shares of AVGO have rallied 51.9% in the last year.
The consensus mark for Jabil’s second-quarter fiscal 2022 earnings has been revised upward to $1.47 per share from $1.41 30 days ago. For fiscal 2022, earnings estimates have been revised upward by 25 cents to $6.58 per share in the past 30 days.
Jabil’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 18.1%. Shares of JBL have gained 65.4% in 2021.
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Marvell (MRVL) Up 84% in 2021: Will the Rally Continue in 2022?
Marvell Technology (MRVL - Free Report) stock outperformed the Zacks Technology Services industry as well as S&P 500 in 2021. Marvell’s shares surged 84% last year, while the Technology Services industry plunged 43.2%. MRVL stock also surpassed the S&P 500 index’s last year rise of 27.6%.
The stock’s price rally reflects the company’s robust fundamentals. Therefore, if you haven’t taken advantage of the share-price appreciation yet, it’s time for you to add the stock to your portfolio now.
The company performed brilliantly last year and has the potential to continue the momentum in 2022 as well.
What’s Driving Marvell Stock’s Growth?
Marvell specializes in highly integrated system-on-a-chip (SoC) and System-in-a-Package devices, based primarily on ARM Holdings’ designs and sells to both enterprise and consumer customers. It has a significant number of patents in design, software and reference platforms to its credit.
The company is benefiting from solid demand for its storage and networking chips from the 5G infrastructure and data-center end markets. Marvell expects continued growth in 5G-related revenues in the near term, driven by continued deployment in Korea and the beginning of higher 5G adoption in the United States, Japan and other countries.
Moreover, MRVL has inked partnerships with Nokia, Samsung and Analog Devices to enhance its capabilities in the 5G solutions space. In March 2021, Marvell and Samsung jointly developed a SoC for Tier-one cellular operators. Integrated into Samsung’s Massive MIMO radio, the new SoC supports both 4G and 5G networks while reducing chipset power consumption up to 70% more than the previous solutions.
Additionally, last year’s acquisition of Inphi Corporation has opened up new avenues of growth for Marvell. MRVL is a leader in infrastructure semiconductor products, while Inphi makes high-speed data movement systems. Therefore, the transaction will broaden Marvell's leadership in data centers and extend its 5G network infrastructure.
Inphi's growing presence with cloud customers will also open additional opportunities for Marvell's DPU and ASIC products. The deal is likely to generate annual run-rate synergies of $125 million, which are to be realized within 18 months after the transaction‘s conclusion. It will also be accretive to Marvell's non-GAAP earnings per share (EPS) by the end of the first year after the deal’s closure.
Solid Growth Expectations
The Zacks Consensus Estimate of $1.55 per share for fiscal 2022 earnings suggests growth of approximately 68.5% from the year-ago period. For fiscal 2023, the consensus mark for earnings is pegged at $2.21, indicating a year-over-year increase of 42.6%. The long-term EPS growth rate is estimated at 24.3%.
Marvell has an impressive earnings surprise history. The company has outpaced estimates in three of the trailing four quarters while meeting the same on one occasion, delivering an average earnings surprise of 7.6%.
Analysts have raised the estimates for fiscal 2022 and 2023 over the past 30 days, reflecting their confidence in the company. During the same period, the Zacks Consensus Estimate for fiscal 2022 and 2023 has moved 10 cents and 30 cents north, respectively.
Zacks Rank and Other Stocks to Consider
Currently, Marvell carries a Zacks Rank #2 (Buy).
Some other similar-ranked stocks from the broader technology sector include Apple (AAPL - Free Report) , Broadcom (AVGO - Free Report) and Jabil (JBL - Free Report) . You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Apple’s first-quarter fiscal 2022 earnings has been revised upward by a penny to $1.25 per share over the past 60 days. For fiscal 2022, earnings estimates have moved upward by five cents to $5.82 per share in the past 30 days.
Apple’s earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while meeting the same on one occasion, the average surprise being 22.3%. AAPL stock gained 33.8% in 2021.
The Zacks Consensus Estimate for Broadcom’s first-quarter fiscal 2022 earnings has been revised upward by 8.1% to $8.15 per share over the past 30 days. For fiscal 2022, earnings estimates have moved upward by 6.5% to $33.03 per share over the past 30 days.
Broadcom’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 1.4%. Shares of AVGO have rallied 51.9% in the last year.
The consensus mark for Jabil’s second-quarter fiscal 2022 earnings has been revised upward to $1.47 per share from $1.41 30 days ago. For fiscal 2022, earnings estimates have been revised upward by 25 cents to $6.58 per share in the past 30 days.
Jabil’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 18.1%. Shares of JBL have gained 65.4% in 2021.