Marvell Stock Has Soared 165% in a Year — Is the Run Finally Over?

Seeing a stock more than triple in a year gives you a certain feeling. Mostly disbelief. With a 52-week range that starts at $53.78, Marvell Technology closed Friday at $164.95, less than six dollars below its all-time high. Consider purchasing it a year ago. You would be sitting on a return of 171%, which is the kind of figure that prompts you to double-check the information on your brokerage app.

Unlike Nvidia, the Santa Clara chipmaker is not as well-known. However, the unglamorous wiring that prevents AI training clusters from choking on their own throughput is located in the same plumbing—networking and connectivity silicon for data centers. The obvious competitor is Broadcom. Marvell has been winning in silence. Throughout the entire fiscal year, revenue increased by 43%. The latest quarterly report showed a 22% year-over-year increase. Additionally, Nvidia expanded their partnership and invested $2 billion in the company in late April. This kind of support doesn’t require a press release.

The market has taken notice. The S&P 500 has gained about 5.6% so far this year, while Marvell stock has increased 94%. When asked if the demand for AI was sustainable during a recent analyst call, CEO Matt Murphy famously said, “Do you see me blinking? You don’t. The stock increased 18% on the day of those comments, suggesting that investors agreed.

This is where things get complicated, though. The stock’s current median price target on Wall Street is $128.36, which would suggest a 22–24% decline from its current trading level. It’s strange to see that gap. Either the consensus truly thinks the stock has surpassed its fundamentals, or the analysts are slow to update their models, which is what happens. For an AI infrastructure company, the P/E ratio is above 53, which isn’t excessive but also not inexpensive. The stock appears to be trading at a significant premium to intrinsic value, according to discounted cash flow models from analysts such as Simply Wall St. The same thing is being quietly noted by even bullish analysts.

Additionally, Poet Technologies, a fiber-optics company whose stock more than doubled on apparent confirmation of an order linked to Celestial AI, a company Marvell acquired in February, was involved in a minor but significant drama last week. A few days later, Marvell notified Poet that the order had been canceled due to a confidentiality violation. In just one week, Poet’s stock fell by more than 50%. Although none of this had a direct impact on Marvell’s stock price, it serves as a reminder of how much weight investors are giving to every announcement about partnerships, customer rumors, and CEO interviews.

Watching this play out gives me the impression that Marvell is in one of those situations that tech investors discover after experiencing one for the second or third time. During the dot-com boom, Cisco had it. Before the 2020 boom, Tesla had it. The basics are true. The growth is genuine. Nvidia, hyperscalers, and government clients are actual customers. However, the price has outpaced the narrative, and each week the stock stays above $160, the difference between the bull and bear cases gets wider.

As of right now, Marvell appears to be a buy that everyone wants during a decline but nobody wants during a peak. The question looming over the upcoming May 28 earnings report is whether and how deep that dip will occur. The business is operating at full capacity. Determining whether that is already included in the price is the trick, as usual.