Marvell Technology, Inc.

(NASDAQ Global Select)
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Bullish +62

“The Next Trillion Dollar Company”: Marvell Is Up 82% in 2026. Take Profits, or Buy More?

Acquisition Analyst downgrade AI-generated analysis

📈 Marvell Technology stock has gained 82% in 2026 after NVIDIA CEO Jensen Huang labeled it the 'next trillion dollar company' and purchased $2 billion of its convertible preferred stock.

📉 The stock retreated from its June highs following an announcement to acquire Lumentum in a $115 billion all-stock deal that increases Marvell's share count by approximately 49%.

💰 Marvell reported record fiscal second-quarter revenue of $2.739 billion, driven by a 46% surge in data center sales which now account for 79% of total revenue.

🚀 Management raised its fiscal 2028 revenue guidance three times since March, projecting growth from roughly $15 billion to approximately $20 billion.

🤝 The Lumentum acquisition targets the critical optical infrastructure needed for AI data centers, with Lumentum's own revenue surging 136.5% in its fiscal first quarter.

📊 Analyst consensus estimates for normalized earnings per share in fiscal 2029 have climbed to $12.60, more than four times the $2.84 posted in fiscal 2026.

📉 The forward price-to-earnings ratio has compressed from a June peak near 70x down to 25x on November 6, trading below its 33x five-year historical average.

⚖️ The Lumentum deal is expected to close in the first half of 2028 pending regulatory approvals, including scrutiny from Chinese authorities.

🎯 Wall Street analysts maintain an average price target of approximately $311, which is roughly double the stock's closing price on November 9.

📅 The upcoming December 1 earnings report will be critical as investors look for fourth-quarter guidance that maintains the $20 billion fiscal 2028 revenue target.

Bullish Signals
  • Marvell reported record fiscal second-quarter revenue of $2.739 billion, a 37% year-over-year increase driven by a 46% surge in data center sales.
  • NVIDIA purchased $2 billion of Marvell convertible preferred stock on March 31, signaling strong confidence from the industry's leading AI chipmaker.
  • Management has raised its fiscal 2028 revenue outlook three times since March, projecting growth to approximately $20 billion during an October investor day.
  • The forward price-to-earnings ratio has compressed to 25x on November 6, trading significantly below the company's 33x five-year historical average.
  • Analyst consensus estimates for normalized earnings per share in fiscal 2029 have climbed to $12.60, reflecting growing confidence in future profitability.
  • The proposed acquisition of Lumentum targets a critical growth area in high-speed optics essential for the next generation of AI data centers.
Risk Factors
  • The stock has given back about half its value since its June high following the announcement of a $115 billion all-stock deal to acquire Lumentum.
  • The proposed Lumentum acquisition adds approximately 49% to Marvell's share count, creating significant dilution for existing shareholders.
  • The deal faces regulatory uncertainty and requires approval from authorities including China before it can close in the first half of 2028.
  • TD Cowen and Bank of America downgraded Marvell to Hold and Neutral respectively, citing concerns over the valuation and dilution associated with the Lumentum deal.
  • The stock experienced a sharp decline on November 4 and 5 due to a broader election-driven selloff affecting the entire chip sector.
Full Analysis
Marvell Technology (MRVL) has surged 82% in 2026, driven by a massive rally following NVIDIA CEO Jensen Huang's endorsement of the company as a potential trillion-dollar entity. However, the stock subsequently retreated significantly after announcing an all-stock acquisition of Lumentum for approximately $115 billion, which dilutes share count by roughly 49%. Despite this volatility and a broader election-driven chip sector selloff in November, Marvell's core business fundamentals remain robust with accelerating revenue growth. The company reported record fiscal second-quarter revenue of $2.739 billion, a 37% increase year-over-year, with data center sales jumping 46% to represent nearly 80% of total revenue. Management has repeatedly raised its long-term outlook, projecting fiscal 2028 revenue to reach approximately $20 billion during an October investor day. Analyst consensus estimates for normalized earnings per share in fiscal 2029 have climbed to $12.60, reflecting strong confidence in the company's ability to scale its optical and AI infrastructure solutions. The proposed acquisition of Lumentum is viewed as a strategic move to capitalize on the generational shift toward high-speed optics required for advanced AI data centers. While the deal adds significant share dilution and faces regulatory scrutiny including from China, Marvell's core business continues to accelerate, trading at a forward P/E multiple of 25x, well below its five-year average of 33x. Wall Street analysts maintain an average price target around $311, suggesting substantial upside potential relative to the current market price.