Marvell Upgraded as PC Demand Holds Up Better than Expected

Jun. 9.09 | About: Marvell Technology (MRVL)

Marvell (NASDAQ:MRVL) shares are trading sharply higher Tuesday morning after JMP Securities analyst Alex Gauna upped his rating on the stock to Market Outperform from Market Underperform, setting a price target of $15. The stock closed Monday at $11.21.

Gauna writes in a research note that the upgrade follows “a range of positive business momentum and design win checks that are driving upward revisions to our near-term and out-year expectations.” He says the company has key design wins in solid-state drives, augmenting a strong position in hard-disk drives. Gauna also says the company is picking up design wins in notebooks, thin clients and “white box” PCs.

The analyst adds that “with the PC channel holding up better than we expected, netbooks generating healthy unit volume demand for HDDs, a solid SSD road map and a benign iPhone refresh [the company supplies parts to Apple for the phone] we are no longer able to justify our prior conservatism.”

For the January 2010 fiscal year, he now sees break-even EPS, up from a previous forecast of a loss of 7 cents. For FY 2011, he now sees 15 cents, up from 7 cents.

MRVL Tuesday is up 94 cents, or 8.4%, to $12.15.

Original post