Shares of Marvell Technology (NASDAQ:MRVL) surged 7% on Tuesday after several Wall Street firms raised their price targets ahead of the company’s earnings release scheduled for Wednesday.
HSBC issues Street-high target on AI infrastructure optimism
HSBC upgraded Marvell to Buy and increased its price target to $300 from $85, establishing the highest target currently on Wall Street.
HSBC analyst Frank Lee said the market continues to underestimate Marvell’s long-term growth potential in optical interconnect and compute express link technologies.
The new target implies upside of roughly 53% from current levels and surpassed the previous Street-high target of $230 issued earlier Tuesday by Susquehanna Financial Group.
Analysts expect strong growth in optical networking demand
Lee raised his fiscal 2027 revenue forecast for Marvell’s optical interconnect business to $5.2 billion, approximately 10% above consensus expectations.
For fiscal 2028, HSBC now projects revenue of $8.8 billion, around 37% higher than analyst consensus.
The firm expects the optical transceiver market to expand by 70% in 2027 as artificial intelligence infrastructure evolves from single-rack systems into larger multi-rack AI factory deployments.
“We believe the revenue growth from optical interconnect is still being underestimated by the market, which will lead to upside to consensus forecasts over the next two years,” Lee wrote.
DSP leadership and AI demand seen driving earnings upside
HSBC highlighted Marvell’s dominant position in digital signal processors, noting the products maintain a one-to-one attachment rate with optical transceivers.
The bank increased its fiscal 2027 and 2028 earnings-per-share estimates by 21% and 61%, respectively, to $4.07 and $7.12.
HSBC also applied a target valuation multiple of 42 times projected fiscal 2028 earnings.
Lee further pointed to potential upside from rising compute express link demand tied to memory shortages and increasing CPU requirements for agentic AI applications.
The firm’s ASIC revenue estimates for fiscal 2028 and 2029 are now 16% and 24% above consensus forecasts.
Susquehanna and Stifel also turn more bullish
Susquehanna Financial raised its target price on Marvell to $230 from $100 while maintaining a positive rating.
Analyst Christopher Rolland noted that Amazon increased projected capital expenditure to $218 billion from $200 billion following first-quarter results from AWS.
Rolland also highlighted a recent agreement between Anthropic and Amazon involving up to five gigawatts of computing capacity.
Regarding Marvell’s Inphi business, Rolland said shipments of 800G transceiver modules are expected to double again in 2026 after already doubling during 2025.
Meanwhile, Stifel analyst Tore Svanberg increased his Marvell target price to $210 from $140 on Friday while reiterating a Buy rating.