[ad_1]
Marvell Technology could win big in the next “wave of AI-led growth,” according to B. Riley Securities. Analyst Craig Ellis upgraded shares to a buy from neutral rating as enterprise spending reaccelerates and inventory-related headwinds begin to ease. MRVL YTD mountain Marvell Technology shares since the start of 2023 The “coming AI and Cloud-led wave sets up potent multiyear financial gains and strong 12-month share outperformance ahead,” he wrote in a Friday note to clients. Shares of Marvell are up more than 55% this year as investors buy into the AI trade, and more gains could come. The firm raised its price target to $75 from $60, representing 30% upside from Thursday’s close. Ellis attributed the sentiment shift to signs of a reaccelerating hyperscale spending in the 2024 calendar year. This momentum should enable AI-related revenue to more than double to $400 million and $800 million in fiscal years 2024 and 2025, respectively. To be sure, some headwinds loom ahead in what B. Riley views as a “still-volatile market.” This includes potentially weak server and storage spending within enterprise markets despite some signs of moderation, Ellis said. “We believe MRVL has near-industry-best product cycles, strong execution, growing AI leverage, and waning inventory risk,” he wrote, adding that solid execution should drive the next leg of margin expansion, revenue and EPS growth, while propelling shares to new records. — CNBC’s Michael Bloom contributed reporting
[ad_2]
Source link
