J.P. Morgan Analyst Harlan Sur sees upside in the low-20s range for Marvell Technology Group Ltd. (MRVL). His estimate is derived by using a group multiple and adding back the cash that Marvell currently has on its balance sheet. The company is his top large-cap pick in the semiconductor space.
“They are a leader in mobile and wireless connectivity, storage semiconductors communications and networking chipsets,” Sur says. “Marvell provides the Wi-Fi and Bluetooth connectivity that fits in the latest generation of game consoles from Xbox One to PlayStation 4. Marvell provides the chipsets that power the cellular connectivity in some of these new 4G smartphones that are being rolled out by the largest service provider in the world, China Mobile (CHL).”
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Sur says Marvell is also is the number-one hard disk drive and merchant market, solid-state controller, chipset market supplier. In their networking space, Sur says Marvell is playing into the trends of next-generation data center and next-generation wireless infrastructure.
“They’ve got a product line of processors that do a lot of the heavy-duty data analysis and data processing and next-generation base stations and next-generation switches, next routers, and that’s a good example of the content processing that we talk about as it relates to our theme of connectivity, content processing and storage,” he says.
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