Those who missed Nvidia’s recent surge may want to consider putting their money in one overlooked artificial intelligence beneficiary: Marvell Technology. Nvidia on Tuesday joined the ranks of the elite $1 trillion market capitalization club, dominated by technology giants Apple, Alphabet and Microsoft. The stock surged 181% this year on AI tailwinds. This month alone, it’s up 48% on the heels of a blowout earnings report driven by booming demand for AI chips. The chipmaker remains a clear winner in the AI arms race, but Wall Street analysts say Marvell Technology is also poised to capitalize on the trend. MRVL 1M mountain Marvell Technology shares over the last month “In-line guide assuaged concerns, but it was the AI comments which stoked the flames,” wrote Barclays’ analyst Blayne Curtis in a note to clients last week, referring to Marvell’s latest quarterly report. “Not sure we can make sense of the recent AI rally, but this is a name that belongs in the basket.” Marvell Technology has experienced some AI tailwinds, surging about 71% this year. The stock Friday rallied more than 32% for its best day on record after the company reported a top-and-bottom line beat. The stock is up more than 61% this month, on pace for its best monthly stretch since 2001. Curtis added Marvell Technology represents a “safer way” for investors to expose their portfolios to the latest AI wave, even as the long-term potential and scale of AI remains unclear. Bank of America analyst Vivek Arya called the chip stock an “underappreciated” AI beneficiary in a recent note. He added demand for generative AI should boost multiyear demand for custom silicon and speed up the “technology refresh rate” for necessary networking solutions. Given the growth in AI demand, Arya upped his price target to $70 from $51 a share, reflecting about 7% upside from Friday’s close, and reiterated his buy rating. Elsewhere, Citi’s Atif Malik opened a positive catalyst watch on the stock, saying he expects management to highlight Marvell Technology’s acceleration within its data center business in the second half of the year fueled by PAM4 DSPs, which provide connectivity for cloud AI and 5G, among other things. MRVL YTD mountain Marvell Technology shares so far this year He highlighted Marvell Technology’s estimation AI revenue will reach $200 million this year and hit more than $400 million in 2024 before doubling in 2025. “All in all, MRVL AI revenue is expected to grow at a 100% CAGR from FY23-FY25,” Malik said. — CNBC’s Michael Bloom contributed reporting.
