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Research Alert: Mrvl Delivers Computex Keynote Speech; Optics Bottleneck Not Going Away Soon

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CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

Shares of MRVL are up sharply after CEO Matt Murphy delivered his Computex keynote speech. Although many will tout Jensen Huang's comment stating that MRVL will be the next $1T company when on stage with Murphy, we wouldn't go that far (at least not yet). More important to us was Murphy's commentary and how the copper wall is breaking down, especially as we rapidly move to 1.6Tbps interconnects (and eventually 3.2Tbps) from 800Gbps. Technology transitions are accelerating at a rapid pace as compute/memory content is exploding in a rack/data center and pushing the limits of connectivity/shifting towards optics. We think MRVL has done an incredible job positioning itself to benefit from this trend, with the right products and its NVIDIA partnership poised to help it see outsized industry growth from CY 27-CY 29. Optics will be a considerable bottleneck into CY 28. We lift our 12-month target to $300 from $230, on a higher revised P/E of about 50x our CY 27 EPS, well above historical to reflect growth prospects.

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