Marvell Technology Shares: Poised for a Breakout?

Marvell Technology captured investor attention on Friday as its stock surged more than 5%, approaching the psychologically significant $90 threshold. With quarterly results scheduled for December 2, market participants are eagerly awaiting the chip designer's performance update. The central question remains whether Marvell will deliver another testament to the ongoing artificial intelligence rally or disappoint investors as it did earlier this summer.

Analysts project impressive third-quarter results, with consensus estimates pointing to earnings per share of $0.75—representing a remarkable 74.4% year-over-year increase. Revenue expectations stand at $2.06 billion, which would translate to 36% growth compared to the same period last year.

The company's positioning within the rapidly expanding AI infrastructure sector forms the core of investor optimism. Market experts highlight Marvell's strengths in custom XPUs and Ethernet switching solutions, positioning the firm as a crucial equipment provider for the data center revolution. For the full fiscal year, analysts anticipate revenue growth exceeding 40%, reaching $8.12 billion.

Divergent Analyst Views Create Market Tension

Wall Street remains divided on Marvell's prospects. J.P. Morgan reaffirmed its "Overweight" rating on November 27, with analyst Harlan Sur establishing a $120 price target. In contrast, HSBC adopted a more cautious stance, initiating coverage with a "Hold" rating and an $85 target price. The British institution cited intense competition with Broadcom in the lucrative ASIC business as its primary concern.

This analytical split reflects broader uncertainties about Marvell's ability to compete effectively against industry giants while maintaining market share. The consensus rating currently stands at "Moderate Buy" with an average price target of $94.41.

Should investors sell immediately? Or is it worth buying Marvell Technology?

Valuation Presents Complex Picture

Marvell's stock currently trades in a fascinating valuation territory. While Simply Wall St considers $90.07 a fair valuation, their discounted cash flow analysis suggests a substantially lower intrinsic value of approximately $61. This discrepancy indicates investors are paying a significant growth premium for Marvell's potential in the AI and data center markets.

Despite recent gains, the stock remains approximately 25% down for 2025. The recovery from April's low of $47 has been noticeable but remains incomplete. The Relative Strength Index reading of around 54 suggests additional upward movement potential before entering overbought conditions.

Previous Quarter Provides Context

The company's last earnings report in August presented a mixed picture. While Marvell achieved impressive revenue growth of 57.6% to $2.01 billion, it fell approximately $10 million short of expectations. Conversely, earnings per share of $0.67 met analyst projections.

December 2: A Potential Inflection Point

All market attention now focuses on the upcoming earnings release. The quarterly results could serve as the catalyst needed to challenge yearly highs or potentially drive the stock back toward its 200-day average around $74. With elevated expectations and significant analyst divergence, the stage is set for a potentially volatile trading session following the announcement.