MRVL Valuation is Deeply Depressed, Reiterate Buy Rating

3/12 - "...management's guidance for the opening quarter of the new fiscal year fell largely in line with our own FQ1 estimates that were in place prior to the FQ4 call. In a sense, this implies a deeper than normal effect of seasonality on FQ1 results, largely dictated by continued weakness faced by Marvell in the WLAN IC-s space. Still, the Y/Y growth trends at Marvell look impressive both on the revenue side and on the profitability side (consider to expected XScale-related gross margin improvements)."

"We currently forecast FY2009 revenues of $3.31B (+14.5% Y/Y, even in a soft macroeconomic environment), non-GAAP gross margin of 49.8%, PACMO/share of $2.15 (+20% Y/Y) and non-GAAP EPS of $0.63 (+43% Y/Y)...We continue to have a $20 6-12 month price target on MRVL stock - equal to 10x our FY2009 PACMO/share view on Marvell, which actually represents a discounted PEG of 0.5x over our 20% 3-5 year growth assumption on the company. As our price target now stands significantly above the depressed market price of MRVL stock, we are reiterating our BUY rating on Marvell."