Core Insights - The article compares two semiconductor companies, Credo Technology Group Holding Ltd. (CRDO) and Marvell Technology, Inc. (MRVL), both of which are integral to the infrastructure supporting AI-driven data centers [1][2]. Group 1: Company Overview - CRDO specializes in high-speed connectivity solutions, particularly in its AEC product line, which has seen significant growth due to its reliability and lower power consumption compared to optical solutions [4][5]. - Marvell has a diversified product portfolio, focusing on custom ASICs, data center switches, and 5G chips, with a strategic pivot towards the data center market [9][10]. Group 2: Financial Performance - CRDO reported a strong fiscal first quarter, with three hyperscalers contributing over 10% of revenues, and anticipates continued revenue growth from these clients [5][8]. - MRVL's data center revenues surged 69% year over year, with a significant contribution from custom silicon and electro-optics, making data center the largest segment for the company [9][11]. Group 3: Growth Drivers - CRDO's growth is driven by its AEC business, optical solutions, and PCIe retimer products, with expectations of substantial revenue growth in fiscal 2026 [6][7][8]. - MRVL's growth is supported by its custom XPU products and a robust design pipeline, with management targeting a significant increase in market share in the data center space [11][12]. Group 4: Market Position and Valuation - CRDO's stock has increased by 76% over the past three months, while MRVL's stock has declined by 1.7% during the same period [9][16]. - In terms of valuation, CRDO has a forward price/sales ratio of 26.94X, which is higher than MRVL's 7.17X, indicating differing market perceptions [18]. Group 5: Analyst Estimates - Analysts have significantly revised earnings estimates for CRDO upwards, while MRVL has seen only minor revisions [20][21]. - CRDO holds a Zacks Rank of 1 (Strong Buy), while MRVL has a Zacks Rank of 3 (Hold), suggesting a more favorable outlook for CRDO at this time [23].

Core Viewpoint - Cisco Systems is expected to report strong third-quarter fiscal 2025 results, driven by improved demand in networking and security products, despite facing some macroeconomic challenges [1][3][5]. Financial Expectations - Cisco anticipates third-quarter revenues between $13.9 billion and $14.1 billion, with non-GAAP earnings expected between 90 and 92 cents per share [1]. - The Zacks Consensus Estimate for revenues is $14.05 billion, reflecting a year-over-year growth of 10.58%, while the earnings consensus is steady at 91 cents per share, indicating a growth of 3.41% year-over-year [2]. Key Growth Drivers - Improved demand for networking products, particularly in switching, enterprise routing, and industrial networking applications, is expected to benefit Cisco's results [3]. - The networking revenue estimate for the fiscal third quarter is $6.76 billion, indicating a 3.6% year-over-year growth [4]. - Cisco's security revenue is estimated at $2.195 billion, showing a significant year-over-year growth of 68.3%, driven by strong demand for solutions like XDR and Secure Access [4][5]. Market Performance - Cisco shares have gained 1% year-to-date, outperforming the Zacks Computer & Technology sector's decline of 8.5% and the Computer Networking industry's return of 0.8% [6]. - However, Cisco's stock is considered to have a stretched valuation, with a forward 12-month P/S ratio of 4.08X, higher than the industry average of 3.89X [9]. Strategic Initiatives - Cisco's investments in AI, cloud, and security are expected to drive growth, with AI infrastructure orders exceeding $700 million in the first half of fiscal 2025 [12]. - The company is leveraging AI across its portfolio, including the launch of the Renewals Agent, an AI-driven solution, and enhancing customer experience through Agentic capabilities [13]. - Cisco's security business is benefiting from strong demand for Cisco Secure Access and XDR, with both solutions gaining over 1,000 customers in the past year [14]. Partnerships and Collaborations - Cisco's partnerships with major companies like Meta Platforms, Microsoft, NVIDIA, and ServiceNow are enhancing its market position [15]. - Collaboration with NVIDIA is expanding Cisco's data center infrastructure portfolio, while the partnership with ServiceNow integrates AI-driven security solutions [16][17]. Conclusion - Cisco's near-term results are expected to benefit from a robust networking and security business, supported by a strong partner ecosystem, despite facing tariff-related and macroeconomic challenges [18].

Core Insights - A stock market selloff was anticipated following the post-Trump election euphoria that significantly boosted AI stocks and other growth sectors, leading to a healthy correction and an opportunity to invest in AI at more reasonable levels [1][5] - Long-term investors are encouraged to start investing in undervalued AI stocks, as the earnings growth outlook remains strong, with S&P 500 EPS projected to increase by 13.3% in 2025 and 13.7% in 2026, alongside expected interest rate cuts by the Fed in 2025 [2] Company Overview: Marvell Technology, Inc. (MRVL) - Marvell is a leader in data infrastructure semiconductor solutions, providing essential products for AI data-center architectures, including data center switches and Ethernet controllers [4][5] - The company has a strong earnings outlook, earning a Zacks Rank 1 (Strong Buy) after a positive Q4 report, with AI silicon programs entering volume production and strong growth in interconnect products [6] - Marvell's revenue is projected to grow by 44% this fiscal year, reaching $10 billion, with adjusted earnings expected to increase by 75% this year and 28% next year [7] Market Performance and Stock Analysis - Despite a solid earnings report, MRVL's stock price fell due to a Q1 2026 revenue forecast that did not meet high expectations, raising concerns about slowing AI infrastructure spending [8] - The stock has experienced a 45% decline from its January highs, trading at decade-long lows in terms of its PEG ratio, despite a 335% increase over the past decade [5][13] - Marvell's stock is currently trading at a 50% discount to the Zacks Tech sector and 95% below its highs, indicating potential for recovery [13] Financial Health - Marvell reported $1.68 billion in annual operating cash flow for fiscal 2025, demonstrating financial stability, and returned $933 million to shareholders through repurchases and dividends [11] - The company has received strong buy recommendations from 28 out of 32 brokerages, indicating positive sentiment among analysts [11]