Key Stats for MRVL Stock
- Past two weeks performance: +1.2%
- 52-week range: $61 to $330
- Valuation model target price: $330
- Implied upside: 39.4% over 2.4 years
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Google Just Became a Major Marvell Stakeholder
Marvell Technology (MRVL) signed one of the more unusual chip deals of the year. On July 29, the company entered a custom semiconductor agreement with Google. As part of that deal, Marvell issued Google a warrant for up to 58.97 million shares at $206.58 each. If Google exercises it fully, the warrant could be worth as much as $12.2 billion.
The structure matters as much as the number. Shares vest in tranches tied to purchasing milestones, with one tranche unlocking for every $500 million in custom products revenue Marvell books from Google. So Google has to actually buy chips for the warrant to pay off. Full exercise would require roughly $120 billion in purchases through fiscal 2033, which would make Google one of Marvell’s largest shareholders.
The products covered are broad. They span AI inference accelerators, storage controllers, network interface controllers, and near-memory compute silicon built to work alongside Google’s own chips. That breadth suggests Google views Marvell as a long-term infrastructure partner rather than a single-project vendor.
This deal lands against already strong momentum. Marvell guided for roughly 40% overall revenue growth in fiscal 2027 to nearly $11.5 billion. First-quarter data center revenue hit a record $1.83 billion. If MRVL stock keeps building on this partnership, the next few years could look very different from the company’s past growth profile.
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Is Marvell Stock Still Undervalued After the Google News?
Under valuation model assumptions realized through 1/31/29, the stock is modeled using:
- Revenue Growth (CAGR): 42.6%
- Operating Margins: 30.0%
- Exit P/E Multiple: 34.5x
Based on these inputs, the model estimates a target price of $330, implying 39.4% total upside from the current share price of $237 and an annualized return of 14.5% over the next 2.4 years.
A 14.5% annualized return lands solidly in the moderately attractive range. That’s before fully pricing in upside from the Google warrant structure. Marvell trades around 52x forward earnings, a premium that reflects both the AI silicon story and real execution risk tied to hyperscaler concentration.
The 42.6% revenue growth assumption is aggressive but reasonable given the company’s own fiscal 2027 guidance of roughly 40%. It could even prove conservative if the Google partnership ramps faster than expected, since the deal alone implies billions in incremental revenue spread over seven years.
Operating margin assumptions of 30% sit well above Marvell’s current LTM EBIT margin of 16.4%. They reflect expected improvement as custom silicon scales toward higher margin products. Compared to its own five-year revenue CAGR of 22.5%, the forward assumption marks a meaningful acceleration driven almost entirely by AI demand. Against direct peers, covered below, Marvell’s valuation looks reasonable rather than stretched.
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How Marvell Stacks Up Against Broadcom
Broadcom (AVGO) is Marvell’s most direct competitor in custom AI silicon. Broadcom guided for roughly 66% revenue growth in fiscal 2026, well ahead of Marvell’s 41%. Its AI semiconductor revenue alone grew 143% year over year last quarter to $10.8 billion. Broadcom’s customer roster includes Google, Meta, Anthropic, and OpenAI, giving it a broader hyperscaler footprint than Marvell currently has.
On valuation, Broadcom trades around 34x forward earnings, actually below Marvell’s roughly 52x multiple, despite Broadcom’s faster growth and larger scale. That gap suggests the market is pricing in outsized expectations for Marvell’s newer partnerships, including the Google deal.
Margins also favor Broadcom right now. Its non-GAAP operating margin runs near 67%, reflecting scale advantages across semiconductors and infrastructure software. Marvell’s LTM EBIT margin sits closer to 16%. That gap should narrow if Marvell’s custom silicon business scales as management expects, but for now it marks a real profitability difference between the two AI infrastructure suppliers.
The Google deal narrows the customer concentration gap somewhat, since Marvell now has a formal, multi-year commitment from a major AI spender. Whether Marvell can match Broadcom’s growth and margin profile over time remains the central question.
What’s Driving MRVL Stock Going Forward?
The Q2 fiscal 2027 earnings report on August 27 is the next major checkpoint. Investors will want early commentary on how the Google relationship is tracking, even though meaningful revenue likely won’t show up for a few more quarters.
Marvell’s broader AI memory infrastructure buildout remains a key growth lever. The company keeps expanding its Photonic Fabric portfolio, aimed at building shared memory architecture for AI inference. If that architecture gains traction with hyperscalers beyond Google, it could become a second major growth pillar.
Demand for 800G and 1.6T optical networking continues accelerating as AI clusters scale. Because these products connect large GPU clusters together, growth in AI workloads translates fairly directly into demand for Marvell’s networking silicon.
Execution risk remains the swing factor. Marvell faces intense competition from Broadcom, Nvidia, and AMD, and the warrant structure ties Google’s stake to aggressive purchasing targets rather than a guarantee. Whether Marvell converts this partnership into durable revenue will determine if today’s growth assumptions hold.
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Should You Invest in Marvell Technology?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
