ហេតុអ្វីបានជាយើងបន្ថែម Chip Stock នេះទៅ Bullpen

Editor’s note: An earlier version of this story incorrectly implied Marvell was not already in the Bullpen. We regret any confusion.

After hinting in the Daily Rundown that we’d revisit semiconductor stocks, we wanted to explain in more detail why we had added the shares of Marvell Technology  (MRVL)  to the ការដាស់តឿនសកម្មភាព PLUS Bullpen.

As the current earnings season has unfolded, we have been reminded from NXP Semiconductor (អិនអេភីភី), Intel (INTC) , and Samsung (SSNLF) , of the challenging months ahead for consumer electronics, especially PCs and smartphones. That has and will likely continue to weigh on the outlook for a number of chip companies, arguably the higher profile ones like AMD (AMD បាន) , Intel and Qualcomm (QCOM)   , which all derive meaningful revenue from PCs and smartphones. 

That brings us to Marvell, which is more properly categorized as an infrastructure semiconductor company, given its end market exposure that is around 88% infrastructure and 12% consumer. More specifically, the data center accounts for around 40% of revenues, enterprise networking almost 25%, carrier communications 18%, consumer 12%, and 5% automotive. Those end markets are driven by autos using more and more chips, as well as the continued growth in digital entertainment and communications that drives mobile network infrastructure demand. In 2022, video accounted for nearly 70% of all mobile network traffic, which speaks to the growth in video consumption across social media, streaming, video conferencing, and video chat. It also points to the strain put on the digital infrastructure.

We will look to pick our spot with MRLV shares. Current expectations call for the company’s earnings per share to fall around 20% in the first half of its fiscal 2024, which are its April- and July-ending 2023 quarters. As we noted recently, however, when we look at the recent price action with Lam Research (អិលអេសអិល)  and even Microsoft (MSFT) , the market has been shaking off downside guidance and layoff announcements. Part of this could be the market’s forward view that has already begun to think about the back half of the year and coming out of what is expected to be a short and shallow recession.

There was an early 2023 bottom in MRVL shares, so we will take a more watchful eye on the shares from here on out. When we next discuss the shares, we will give more thoughts on valuation and a potential long-term price target.