Don’t Dump This 5G Stock Despite a Double Downgrade

Person holding a 5G smartphone.

Marvell Technology Group (NASDAQ:MRVL) looked like a top pick to benefit from the rollout of fifth-generation (5G) wireless networks this year, but investment banking firm Cowen believes the chipmaker is going to disappoint. Cowen recently slapped Marvell stock with a double downgrade — reducing it to underperform from outperform — stating the company’s limited presence in China will handicap its 5G opportunity.

Cowen analyst Karl Ackerman believes Marvell won’t be able to deliver on the rosy revenue and earnings forecasts that investors are anticipating. Ackerman said the company has little market share with network providers rolling out 5G in China, and its incremental revenue growth will be nowhere near what Wall Street is predicting.

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