CIBC Bullish On Marvell Following Wireless LAN Coup (MRVL, NTGR)

Following Netgear's announcement this week that Marvell's 802.11n chipsets are being integrated into their products, CIBC's Allan Mishan and Sam Dubinsky issued a bullish note to clients. Excerpts include:

We are growing more confident in our aggressive stance on MRVL following the announcement of an 802.11n design win at consumer/SMB networking leader Netgear. This win should not be underestimated; the wireless LAN market is at the beginning of a major transition to the faster 802.11n standard, and Marvell has leapfrogged competitors after entering the market late for 802.11b.

We believe this business could drive significant upside for Marvell in 2H06 and 2007, and continue to advise investors to take advantage of recent weakness in MRVL to build and add to positions in this premier semiconductor company...

With 802.11n, Marvell is engaging all segments of the market, opening up tens of millions of units to the company at pretty attractive ASPs (high teens to low 20s according to our checks). The win with consumer/SMB networking leader Netgear is a major validation of Marvell's solution, and will provide nice volume from access points and NIC cards in 2006 and 2007.

MRVL 1-yr Chart