Cowen Sees CEO, President Resignations at Marvell (MRVL) as Positive for Investors; Affirms at 'Outperform'

Cowen and Company is out with commentary on Marvell (Nasdaq: MRVL) after Marvell CEO Sehat Sutardja and President Weili Dai resigned their positions. The firm as Marvell with an Outperform rating and $15 price target.

Analyst Timothy Arcuri said today, We see these changes as a long time coming and hugely positive for investors as management has made many missteps recently, including a failure to reach a deal to sell or spin off the mobile platforms business, a mishandling of the CMU lawsuit and the recent accounting problems. We think having Sehat on the Board is a strategic long-term positive, however, given he is a great technologist that has been paramount to MRVL’s success. We feel that allowing the long term auditor PwC to resign was the final straw, as highlighted in our note on the topic (see Extending Purgatory, But Forcing Much Needed Change).

These changes open up a range of investor friendly possibilities from cutting unneeded projects (we estimate that there is about $250MM annual R&D spending on experiments that have a low chance of generating revenue) to maximizing value through a breakup of the company, Arcuri noted.

For an analyst ratings summary and ratings history on Marvell click here. For more ratings news on Marvell click here.

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