Marvell Technology Group (MRVL, Financial) jumped 10% on Friday, hitting an all-time high of $120. Investors cheer the semiconductor company’s market cap of over $101 billion as it is growing confident in its strategic direction and its ability to ride the wave of high storage, processing and networking demand. A return to profitability in the near term is expected, based on a consensus of 28 analysts who recently revised their earnings expectations upward for benefits despite operating with a moderately levered balance sheet.
A key driver of the company’s stock performance has been its focus on expanding its product portfolio, which recently launched its 1.6 Tbps optical chipset and custom high bandwidth memory (HBM) compute architecture. These advancements are designed to improve AI-driven data centres and campus data centre interconnects. Marvell also introduced the first ever 1.6 Tbps coherent-lite digital signal processor (DSP), validating the company’s leadership in the growing AI market.
This is after Broadcom this week revealed an annual 220% increase in the sale of AI products, sparking widespread optimism for the semiconductor industry. Marvell has received price target increases from analysts at TD Cowen and Piper Sandler for strong financial results and optimistic growth in AI tech.
This article first appeared on GuruFocus.