On June 4, Marvell Technology (NASDAQ:MRVL) stock ended the day at $316.43, a record close. As of this writing, shares trade near $248, or about 21% below that record, even after bouncing more than 10% from their Oct. 22 close.
The business hasn’t gone backward in the meantime. At an investor day on Oct. 6, the company raised its revenue forecast for fiscal 2028 (the year ending in January 2028) to around $20 billion. In August, it had called for about $18 billion. Reaching $20 billion would mean growth of about 67% from the roughly $12 billion Marvell expects this fiscal year.
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I think the drop is a chance to buy, but not all at once. Here are two reasons I’d buy shares now and one reason I’d hold some money back.
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1. The data center target moved up a year
Data centers are where almost all of Marvell’s growth comes from. They made up 79% of revenue in the fiscal second quarter of 2027 (ended Aug. 1).
Showing how fast that business is growing, Marvell’s data center revenue rose 46% year over year to about $2.17 billion in fiscal Q2. What’s more, management guided for data center growth to accelerate to about 75% year over year in the fiscal third quarter, and it now expects data center revenue to climb about 60% for all of fiscal 2027, up from its earlier forecast of about 50%. “AI-related bookings remain exceptionally robust,” CEO Matt Murphy said in the fiscal second-quarter earnings release.
The longer-term targets have moved up even faster. In 2024, Marvell set a goal of $15 billion in data center revenue for fiscal 2029. Last year, it lifted the goal to about $18 billion. And at this month’s investor day, it said it now expects to hit about $18 billion a year early, in fiscal 2028.
For reference, Marvell’s data center business took in $6.1 billion in fiscal 2026, so the new target is almost triple that. Put another way, every update has pulled more growth into the same years.
2. The stock got cheaper as the forecast rose
Granted, Marvell stock isn’t cheap on this year’s numbers. At around $248, it trades at about 59 times the earnings expected for this fiscal year. Against expected earnings for fiscal 2028, though, the price-to-earnings ratio drops to about 34.
For comparison, that same fiscal 2028 earnings estimate would have put the stock at about 43 times earnings at its June record. And since June, management’s revenue outlook for fiscal 2028 has climbed by about $3.5 billion, from roughly $16.5 billion in May.
