Nomura Says Marvell (MRVL) Shares Oversold

Nomura Securities analyst Sanjay Chaurasia reiterated a Buy rating and $19 price target on Marvell (NASDAQ: MRVL) saying shares are oversold.

Chaurasia commented, "Marvell’s shares have underperformed the SOX by 3,000bp this year. With the shares trading at a ~30% discount to our coverage vs an average discount of 15%, we remain constructive on Marvell’s shares despite expected near-term weakness. We think the damages awarded in the CMU patent case could be substantially reduced. We estimate that the damages could be reduced to roughly $300m-350m if applied on the infringing HDDs sold only in the US, significantly lower than the current award of $1.2bn. Moreover, we remain positive on the company’s 4G traction. In the near-term, we expect Samsung’s weakness to weigh on our mobile revenue estimate of $305m (up 5% q-o-q) in the Oct-Q. For the Jan-Q, we expect the company to guide to overall revenues in the $940m-950m range, higher than the consensus of $931m but lower than our estimate of $970m."

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 $13.04 yesterday.

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