Marvell Technology Earnings Preview (May 17, 2007)

Marvell Technology Group Ltd. (MRVL-NASDAQ) reports earnings after the close today.  This is a coin toss going in because the company has been deliquent in its SEC filings for 3 quarters.  So the "EPS" is still an "if" but estimates are $0.09 EPS and $646 million revenues.  The July quarter is estimated at $0.11 EPS and $682.7 million revenues and the Fiscal Jan-08 estimates are ‘roughly’ $0.55 EPS and $2.86 Billion.

The truth is that companies that are this delinquent in filings are a total guessing game for an outsider now.   Marvell is a fabless chip designer that has many technology design wins geared toward WiMAX and Wi-Fi initiatives being rolled out now and those in planning stages.

Because of warnings and filing delays and mixed analyst coverage and a choppy chip sector, Marvell stock is barely above its yearly lows.  The stock closed Wednesday at $17.04, and the 52-week trading range is $15.91 to $28.27.  Options traders appear braced for up to a $0.35 to $0.45 move in either direction; but keep in mind that options expire tomorrow and that number roughly doubles if you go out to June expirations.  Marvell’s short interest last month was fairly steady from the month before at 18.2+ million shares, or about 2 days trading volume.

Jon C. Ogg
May 17, 2007

Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.