Jefferies Raises Price Target on Marvell (MRVL), Thailand Flooding Temporary, Growth Outlook Not
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Price: $64.91 -0.51%
Rating Summary:
45 Buy, 7 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 10 | Down: 18 | New: 16
Rating Summary:
45 Buy, 7 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 10 | Down: 18 | New: 16
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Jefferies remains bullish on shares of Marvell (NASDAQ: MRVL) and is reiterating its Buy rating on the shares while raising its price target from $17 to $18.
To account for the major flooding in Thailand recently, the firm is cutting its Q3 revenue and EPS estimates from $960 million and $0.41 to $933 million and $0.41. Jefferies notes that this disruption in the supply chain is already factored into the stocks current price and that all supply chain issues will be recovered by the second half of 2012.
The firm notes that MRVL has become more of a handset play than a RIM (Nasdaq: RIMM) play alone as RIM only accounts for 7 percent of the company's total revenue, down from 28 percent previously.
Jefferies reports that MRVL's SoCs are inside some of the highest selling TD smartphones, including ZTE (U880), Huawei (T8300), Motorola (MT620), SONY Ericsson (WT18i) and Lenovo (LePhone A66t). They are point out that the company's integrated baseband SoC is qualified in 3-to-5 non-TD/non-RIMM andoid based smartphones.
An analyst at Jefferies comments, "We believe that SSDs could see a knee in the shipment curve in 2012, which could translate to an acceleration in growth in that business. We believe that MRVL is the leading supplier of SSD controllers into the notebook PC market (used by INTC, MU and DELL), and think that growth in that business will also translate into multiple expansion."
For fiscal 2012 and 2013, the firm is cutting its EPS estimates from $1.42 and $1.52 to $1.33 and $1.49. Revenue estimates for the two years were reduced from $3.59 billion and $3.88 billion to $3.45 billion and $3.77 billion. For fiscal 2014, Jefferies predicts earnings of $1.81 per share on $4.26 billion in sales.
For an analyst ratings summary and ratings history on Marvell click here. For more ratings news on Marvell click here.
Shares of Marvell closed at $14.84 yesterday.
To account for the major flooding in Thailand recently, the firm is cutting its Q3 revenue and EPS estimates from $960 million and $0.41 to $933 million and $0.41. Jefferies notes that this disruption in the supply chain is already factored into the stocks current price and that all supply chain issues will be recovered by the second half of 2012.
The firm notes that MRVL has become more of a handset play than a RIM (Nasdaq: RIMM) play alone as RIM only accounts for 7 percent of the company's total revenue, down from 28 percent previously.
Jefferies reports that MRVL's SoCs are inside some of the highest selling TD smartphones, including ZTE (U880), Huawei (T8300), Motorola (MT620), SONY Ericsson (WT18i) and Lenovo (LePhone A66t). They are point out that the company's integrated baseband SoC is qualified in 3-to-5 non-TD/non-RIMM andoid based smartphones.
An analyst at Jefferies comments, "We believe that SSDs could see a knee in the shipment curve in 2012, which could translate to an acceleration in growth in that business. We believe that MRVL is the leading supplier of SSD controllers into the notebook PC market (used by INTC, MU and DELL), and think that growth in that business will also translate into multiple expansion."
For fiscal 2012 and 2013, the firm is cutting its EPS estimates from $1.42 and $1.52 to $1.33 and $1.49. Revenue estimates for the two years were reduced from $3.59 billion and $3.88 billion to $3.45 billion and $3.77 billion. For fiscal 2014, Jefferies predicts earnings of $1.81 per share on $4.26 billion in sales.
For an analyst ratings summary and ratings history on Marvell click here. For more ratings news on Marvell click here.
Shares of Marvell closed at $14.84 yesterday.
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