Marvell Technology, Inc. (MRVL): A Bull Case Theory

Core Thesis - Marvell Technology, Inc. is viewed as a compelling investment opportunity, trading below its intrinsic value of $94.80 per share, with a recommended buy price of $90.29 after applying a 5% margin of safety [2] - The market's overreaction to Marvell's cyclical revenue patterns has created a rare entry point for long-term investors [2] Company Overview - Marvell is a leading fabless semiconductor company focused on B2B solutions across data infrastructure, including computing, networking, security, and storage [3] - Core growth is driven by Custom ASICs for AI workloads and hyperscale cloud providers, alongside electro-optics and networking solutions essential for managing data traffic [3] Financial Performance - Marvell reported record Q2 FY26 revenue of $2.006 billion, up 58% year-over-year, with data center revenue contributing $1.44 billion [4] - Non-GAAP operating margins expanded by 870 basis points to 34.8%, reflecting scalable operational leverage [4] - The company has demonstrated disciplined capital allocation through the divestiture of its non-core Automotive Ethernet business for $2.5 billion, with proceeds directed toward share buybacks and strategic R&D [4] Market Misinterpretation - The temporary lull in hyperscale orders has been misinterpreted by the market, creating a mispricing opportunity for investors [5] - Despite negative GAAP profitability due to non-cash charges, non-GAAP results indicate robust underlying performance [5] Strategic Focus - Marvell's strategic pivot toward AI and data center markets remains intact, with a simplified, AI-focused business model and strong operational execution [5][6] - The emphasis on operational leverage and the recent divestiture are seen as catalysts for future growth [6]