How to Play the Post-Earnings Selloff in Marvell Technology Stock
Marvell (MRVL) stock was under significant pressure on Aug. 28 even though the custom chip specialist posted a market-beating Q2, featuring a 37% year-on-year increase in revenue.
Crucially, the semiconductor giant also raised its guidance for fiscal 2028 to around $18 billion, which would represent 50% growth on a year-over-year basis.
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Despite the post-earnings selloff, however, Marvell shares remain up some 160% versus the start of this year.
According to Vivek Arya, a senior Bank of America analyst, MRVL stock's post-earnings pullback is actually a buying opportunity for long-term investors.
"We ignore this expectation mismatch," he told clients in a research report, adding the company is strongly positioned to "accelerate its top-line growth rate towards mid-50s YoY."
Arya emphasized that Marvell's core structural growth drivers in custom silicon (XPUs), optical interconnects, and high-speed Ethernet switching remain fully intact.
MRVL is currently trading at a rather stretched price-earnings (P/E) ratio of about 80x, but the BofA expert remain convinced that artificial intelligence (AI) tailwinds helps justify that premium.
Investors should also note that options market seems to agree with Arya's bullish view on Marvell stock.
According to data from Barchart, the put-to-call ratio on contracts expiring mid-December sits at 0.66 currently; a reading below 1.00 is typically interpreted as bullish.
More importantly, traders have the upper price on those contracts set at about $269 as of writing, indicating potential for about a 24% rally in MRVL through the remainder of 2026.
Note that Marvell Technology does also pay a small dividend yield of 0.11%, which makes it even more attractive as a long-term holding.
What's also worth mentioning is that other Wall Street firms, including Barclays, UBS, Wells Fargo, and Citigroup also reiterated their bullish stance on MRVL shares after the quarterly print.
In fact, the consensus rating on Marvell Technology sits at "Strong Buy," with price targets going as high as $400 and indicating potential for another 130% rally from current levels.
