I just got done reading several sell-side reports post fiscal quarter ended July 2012 and they all seem to have a common theme, which is:
The Company generates very healthy cash flow ($500-$700 million per year), net cash on the balance sheet (~$2 billion) represents a third of its market cap and signifiant stock buybacks will add value when the business recovers BUT don't buy MRVL because it
Lacks Near-term Catalyst.
Those words are music to the ears of a value investor.
Some reports even had an angry tone - why didn't the Company pre-announce the miss? This typically happens when analysts are left a bit in the dark and feel embarrassed in front of their clients for not having given them proper warning to get out of the way before a miss.
Having been a former sell-side analyst myself, I chuckle at these because...well, I have been there. The question you have to ask yourself is this - What does that have anything to do with value?
Can this stock go lower? Of course it can. Most likely things will get worse before they get better but if you think like a business owner as opposed to a stock owner, Marvell's cash and free cash flow should provide you with some assurance that its business will remain intact through the downturn. It should not get distressed to the point where investors suffer a permanent loss of capital.
Whenever the cycle turns in Marvell's favor (and it likely will, that is why its called a Cycle) the appreciation in its enterprise value very likely will more than make up for the pain that investors are going through presently.
Disclosure: I am long MRVL.