Barclays Turns Bullish on Marvell (MRVL), Sees 31% Upside on AI Optics Growth

TLDR

• Barclays raised its rating on MRVL to Overweight from Equal Weight, increasing its price target to $150 from $105.
• The updated target suggests approximately 31% upside from the current share price.
• Barclays forecasts that Marvell’s optical revenue could increase by around 90% in the next two years.
• Industry analysis indicates that optical ports in AI data centers might double in 2026 and then double once more in 2027.
• Even in a pessimistic scenario — excluding Microsoft and assuming no growth from Amazon — Marvell could still achieve roughly $5 in earnings.

(SeaPRwire) –   Marvell Technology has performed strongly, with its stock price more than doubling in the last year. A new upgrade from Barclays is providing further momentum.

Marvell Technology, Inc., MRVL

On Thursday, Barclays analyst Thomas O’Malley upgraded his rating on MRVL to Overweight from Equal Weight and increased his price target from $105 to $150. This new target indicates a potential gain of about 31% from current trading levels.

The central argument from Barclays is not focused on chips, but rather on optics.

Marvell manufactures optical components for connections within AI data centers. O’Malley stated in his research note: “This story will come down to executing on a well understood and bullish forecast and we think the narrative is shifting more toward Optics where it belongs.”

According to Barclays’ industry research, the number of optical ports in AI data centers is projected to double in 2026 and then double again in 2027. Consequently, the firm anticipates Marvell’s optical business will grow by approximately 90% over the coming two years.

Demand From Big Tech Remains a Key Driver

Despite competition from Broadcom (AVGO) in the market, Barclays believes overall demand is robust enough to facilitate growth for both companies.

Barclays also conducted a more conservative analysis to assess potential downside. In this model, the firm completely removed contributions from Microsoft, assumed zero growth from Amazon, and used lower assumptions for AI demand.

Even under these stringent conditions, the firm estimates Marvell could achieve approximately $5 in earnings, indicating the core business is resilient on its own.

Barclays does not anticipate this bear case will materialize. The firm views Microsoft as a significant growth driver moving forward as AI infrastructure continues to expand.

NVLink and Nvidia Could Add More Upside

Barclays also highlighted Nvidia and its NVLink platform as a potential source of additional growth. The firm indicated that recent advancements there could lead to increased usage and stronger performance for Marvell.

According to TipRanks, MRVL currently has a Strong Buy consensus rating, derived from 23 Buy ratings and four Hold ratings over the past three months.

The average analyst price target is $121.75, suggesting around 6.38% upside from current levels, which is significantly lower than Barclays’ more optimistic $150 target.

In premarket trading on Thursday, Marvell stock was up 1.8% at $116.50.