Nvidia reigns as the dominant artificial intelligence play, but investors may also want to keep an eye on networking chip stocks Marvell and Broadcom , according to Bank of America. Networking semiconductors play a critical role in the graphics processing units underpinning many generative AI models, and these names should benefit from long-term demand for their Ethernet networking offerings, according to senior analyst Vivek Arya. “Ethernet has a wider range of workloads it caters to, from those that require high bandwidth to ones that require extensibility,” the analyst explained in a Wednesday note. NVDA YTD mountain Nvidia shares in 2023 Demand for more data at faster speeds should also drive the need for improved bandwidth and networking infrastructure, creating a $1.4 billion opportunity for the optical interconnect space where Marvell Technology has captured a more than 75% market share. Given this optimal setup for networking chipmakers, Arya upped his price target on shares of Broadcom to $1050 from $950, reflecting 24% upside from Wednesday’s close, and hiked his target on Marvell to $75 from $70. Still, Arya labeled Nvidia as the best-positioned name. But all three stocks have gained this year as artificial intelligence gains steam as an investment theme, with Nvidia soaring more than 195%. Broadcom and Marvell have added about 50% and 59%, respectively. — CNBC’s Michael Bloom contributed reporting
