Shares of Marvell Technology Group Ltd. (MRVL) continue to slide in midday trading, taking a nearly 3 percent hit to $15.78. Weakness attributed to a research note from Wedge Partners analyst Brian Blair who asserts that Research In Motion (RIMM) appears to be moving entirely away from Marvell Technology’s app processor and is migrating to Qualcomm’s (QCOM) Snapdragon platform. Blair said it views this as a clear negative for the Hamilton, Bermuda-based Marvell.
[From Forbes]: “Since January, it has appeared that RIMM would choose Qualcomm for one BlackBerry model this year,” Blair writes in his research note to clients, “but we believe RIMM has chosen to move away from Marvell entirely.” Blair notes that Marvell has been providing a 624 MHz processor for most BlackBerry devices since 2008. With RIMM selling about 15 million units a quarter, he adds, “this would be a nice pickup for Qualcomm.”
Blair reiterates the firm’s “negative view of Marvell’s fundamentals” which he notes “remain unchanged.”
From a valuation perspective, MRVL currently trades at a 2.89x on a price to sales basis. The equity has a trailing P/E of 11.95, a forward P/E of 9.47 and a P/E to Growth ratio of 0.80.
In its share capital MRVL has 633.40 million outstanding shares among them 492 million shares have been floated in market exchange. MRVL stock institutional ownership remains at 75.60%.
Today’s trading range for shares of chip specialist Marvell Tech Group Ltd. has been between $15.78 – $16.41 per share. The median Wall Street price target on the stock is $22.00 with a high target of $27.00.
MRVL lost 38 cents, or 2.32%, to $16.01 at 1:32 p.m. E.T. in Nasdaq composite trading.