Tuesday, August 26, 2008

Marvell Tech (NASDAQ:MRVL): MRVL under $15 should be bought - Avian Research

Avian Research thinks the street is too low for next qtr and the concerns on HDD related biz is overdone. The bar for next qtr is set so low that they could keep HDD rev's flat (WDC guided for 8-14% shipment growth) and still hit street numbers. Firm's model right now has them doing $930M in revs for Q3, significantly above the street's $887M. Share loss at RIMM shouldn't be a concern until mid '09 and we can back out Thunder and Javelin entirely and still have their cellular business doing 20% growth in '09. This company was $37 when they bought xScale from INTC and went through a whole slew of problems since then with SEC investigation and options overhang and potential management shake up. Last qtr was when they turned the corner. They cleared up the SEC investigation, got the margin profile headed back in the right direction, announced a new CFO and showed ridiculous revenue growth. Outside of being a supplier to WDC (which hasn't been a bad place to be) MRVL is in Blackberry, they're in the iPhone, they have an SSD controller biz with INTC, they are basically in every important area of technology outside of Solar. Believe MRVL growing revenues at 20+% and trading under 15x EPS is one worth owning.

Notablecalls: Good colour from Avian - fyi

No comments: