Marvell's outlook reassures investors, shares up (Global Markets) - Shares of Marvell Technology Group (MRVL.O) rose 13 percent in pre-market trading on Friday, a day after the company gave third-quarter outlook largely above estimates which allayed Street concerns that its mobile business was hurting.Stock Market Predictions
The company, which makes processor chips used in smartphones and also provides microcontrollers to hard drive makers, projected third-quarter revenue of $940-$980 million, largely above prior consensus of $958.1 million.
"Marvell's product cycles in TDMA based-Smartphones, Solid-State Drive controllers ... provide visibility into growth in 2012," Jefferies analyst Mark Lipacis said.
Shares of the company have been battered at the stock market and have lost over almost half their value since touching a high of $22 in January.
"We think that the case that Marvell is out of favor in the investment community is an easy one to make. For starters, Marvell is the worst-performing semiconductor stock in 2010-11 and third-worst performer year-to-date," Lipacis said.
Lipacis, slashed his target price by a $1 to $17 on the company's stock on valuation concerns but maintained his "buy" rating on the stock.
At least three other brokerages also cut their target price on similar concerns.
"We view July quarter results and guidance as a positive catalyst relative to investor expectations and Marvell's recent stock performance," Kauffman Brothers analyst Mike Burton said.
Marvell shares have lost 36 percent in value since the beginning of the year, trailing the broader Dow Jones US Semiconductor Index .DJUSSC, which has lost 16 percent during the period.
Shares of the company were trading up 7 percent at $12.78 before markets opened. They had closed at $11.97 on Thursday on Nasdaq.
(Reporting by Himank Sharma in Bangalore; Editing by Joyjeet Das)
0 comments:
Post a Comment