Marvell Technologies Stock Presents Opportunistic Pullback Levels

Thursday, March 4, 2021 | Jea Yu
Semiconductor developer Marvell Technologies (NASDAQ: MRVL) stock been uptrending to multi-year highs after recovering off pandemic lows made in March 2020. The Company is hitting on all cylinders as nearly every segment is showing growth, even the legacy storage segment. The most robust growth is expected to continue in 5G, networking, cloud, and automotive. While the automotive sector has recently announced issues with the chip shortage having material impacts on earnings in 2021, the markets view it as a sign of robust demand for chip makers outstripping supply. The recent downdraft in the semiconductor sector can provide prudent investors with opportunistic pullback levels to consider taking exposure in Marvell.

Q3 FY 2021 Earnings Release

On Dec. 3, 2020, Marvel released its fiscal third-quarter 2021 results for the quarter ending October 2020. The Company reported an earnings-per-share (EPS) profit of $0.25 excluding non-recurring items meeting consensus analyst estimates of $0.25. Revenues rose 13.3% year-over-year (YoY) to $750.1 million beating analyst estimates of $751.01 million. The Company provided in-line guidance for Q4 2020 expecting EPS between $0.25 to $0.33 versus $0.28 consensus analyst estimates. Revenues for Q4 are expected to come in between $745.75 million to $824.50 million versus $785.40 million analyst expectations. The Company noted strength in networking, cloud and 5G. Networking revenues rose 35% YoY. Supply chain constraints are keeping the Company conservative on its forecasts.

Conference Call Takeaways

Marvell CEO, Matt Murphy discussed a major win, “One of these OEMs also selected our next-generation 5-nanometer OCTEON processors to replace their current x86 Solutions across their entire enterprise router platforms.” Referring to beating out semiconductor behemoth Intel (NASDAQ: INTC) . CEO Murphy also highlighted the synergies of its Inphi acquisition, “Marvell’s leadership in embedded processors for 5G infrastructure will better position Inphi to participate in the optical conductivity opportunity. In cloud, Inphi’s electro optics platform is critical to data center architecture, and they have established a direct relationship with the industry’s largest cloud infrastructure providers.” The supply chain issues were detailed, “The rapid recovery this year in the semiconductor industry appears to be stressing significant portions of the supply chain. These supply challenges are currently limiting our ability to fully satisfy the increasing demand for some of our networking products.” China is the highest area of growth for the Company, especially in 5G. However, outside of China, the momentum is expected to accelerate the fastest in the U.S. and Japan, “Our 5G customer base continues to expand, and the second regional customer has selected Marvell’s industry-leading OCTEON fusion-based NAND processors to power all their 5G base stations.”

Growth Drivers

Marvell is well-positioned in the strongest growth segments in semiconductors. The 5G rollout is still in the early stages and its chips are key components for the development on next-gen Radio Access Network (RAN). OCTEON fusion processors are the leading silicone platform for 5G-based band and radio processing. Cloud computing continues to accelerate as more and more companies and end users are migrating to the cloud. The notion of downloading a standalone program taking up resources on your system is dissipating as applications move to the cloud. Rather than tying up resources and slowing your system done, the cloud enables technology providers to do all the heavy legwork and push just the information you need quickly and conveniently. When’s the last time you purchased a spreadsheet or word processing program? Microsoft (NASDAQ: MSFT) Office is a subscription-based cloud product just as Google (NASDAQ: GOOG) Docs, Adobe (NASDAQ: ADBE) Acrobat and PhotoShop and so on and on. The Company has guided very conservatively due to supply constraints. The bar was set low. Prudent investors can monitor opportunistic pullback levels to consider building positions as the underlying growth drivers will continue to accelerate.       

Marvell Technologies (NASDAQ: MRVL) Stock Opportunistic Pullback Levels

 MRVL Opportunistic Pullback Levels

Using the rifle charts on the monthly and weekly time frames provides a broader view of the playing field for MRVL shares. The monthly rifle chart uptrend has a rising 5-period moving average (MA) support at $46.22 with upper Bollinger Bands (BBs) at $57.83. The monthly 15-period MA is rising at $35.67. The monthly stochastic has peaked at the 90-band, but still could form a pretzel mini pup, but will need the weekly stochastic to cross back up. The monthly market structure high (MSH) triggers under $46.14. The daily monthly market structure low (MSL) triggered above $38.68. The weekly rifle chart uptrend is stalled as the 5-period MA slopes down at the $50.94 Fibonacci (fib) leveland 15-period MA at $48.36. The weekly stochastic formed a mini inverse pup through the 80-band setting up a make or break that can turn into a pup breakout or mini inverse pup breakdown. Prudent investors can watch for opportunistic pullback levels at the $45.60 fib, $43.30 fib, $41.66 fib, $38.68 fib, and the $36.78 fib. The upside trajectories range from the $58.65 fib up towards the $70.00 level. 

Featured Article: Net Income



7 Lithium Stocks That Will Power the Electric Vehicle Boom

Demand for lithium is set to increase exponentially in the next few years. In fact, according to Statista, demand for lithium may very well double to 820,000 tons in that time. Some of that demand will come from companies that are manufacturing the batteries that we use every day. For example, lithium is an essential component of the batteries that power our mobile devices.

But the real growth will come as the United States goes all-in on electric vehicles (EVs). The Biden administration recently announced plans to have the U.S. government’s fleet of over 600,000 vehicles converted to EVs.

And as you’re aware, EV stocks are in a bubble of some sort at the moment. Some of that is due to the increasing number of companies that went public last year. However, as investors are beginning to realize, not all of these companies will be the next Tesla. In fact, some of these companies may never be successful at bringing an EV to market, at least not at the scale that will be required.

The ones that do make it will need lithium and lots of it. To help you sift through the best lithium stocks to buy, we’ve put together this special presentation.

View the "7 Lithium Stocks That Will Power the Electric Vehicle Boom".


Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Marvell Technology Group (MRVL)2.1$47.91-1.8%0.50%21.98Buy$49.96
Compare These Stocks  Add These Stocks to My Watchlist 

MarketBeat - Stock Market News and Research Tools logo

MarketBeat empowers individual investors to make better trading decisions by providing real-time financial data and objective market analysis. Whether you’re looking for analyst ratings, corporate buybacks, dividends, earnings, economic reports, financials, insider trades, IPOs, SEC filings or stock splits, MarketBeat has the objective information you need to analyze any stock. Learn more.

MarketBeat is accredited by the Better Business Bureau

© American Consumer News, LLC dba MarketBeat® 2010-2021. All rights reserved.
326 E 8th St #105, Sioux Falls, SD 57103 | U.S. Based Support Team at [email protected] | (844) 978-6257
MarketBeat does not provide personalized financial advice and does not issue recommendations or offers to buy stock or sell any security. Learn more.

Our Accessibility Statement | Terms of Service | Do Not Sell My Information

© 2021 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see disclaimer. Fundamental company data provided by Zacks Investment Research. As a bonus to opt-ing into our email newsletters, you will also get a free subscription to the Liberty Through Wealth e-newsletter. You can opt out at any time.