Marvell Technology Inc (NASDAQ: MRVL) rallied more than 10% this morning after announcing a collaboration with Empower Semiconductor on developing integrated power solutions for its custom silicon platforms.
These optimised solutions will help improve the overall performance and efficiency of artificial intelligence (AI) data centres, according to the company’s press release on Wednesday.
Including today’s gain, Marvell stock is up more than 50% versus its year-to-date low on April 4th.
Why Empower deal means for Marvell stock
Marvell and Empower will use a non-traditional silicon-integrated design for voltage regulation to minimise power transmission losses. According to Will Cu, a senior vice president at MRVL:
“Placing integrated voltage regulators (IVRs) under, near, or inside the package delivers greater performance and greater efficiency.”
So, teaming up with Empower will help Marvell offer more power-efficient, high-performance custom silicon solutions – critical for next-generation XPUs, which will improve its value proposition to hyperscalers, potentially driving greater adoption of its platforms.
Overall, the announced partnership will likely boost margins, expand market share, and reinforce the company’s role in enabling the kilowatt-chip era – all of which may translate to an increase in Marvell stock price over time.
MRVL shares are still trading at attractive valuation
Despite a massive rally over the past two months, Marvell stock remains exciting to own since it continues to offer a compelling risk-reward.
At the time of writing, MRVL shares are going for more than 7 times its forward sales only, which is significantly below its average of more than 10 times over the past five years.
Additionally, Marvell is rather inexpensive to own compared to other semiconductor stocks. The segment leader, Nvidia, for example, is currently trading at a forward price-to-sales of more than 16 times.
Investors should also note that MRVL pays a small dividend yield of 0.31% as well, which makes for another good reason to have it in the investment portfolio.
Is it worth buying Marvell stock today?
Financial strength is among other reasons that warrant owning Marvell stock in the back half of 2025.
Last month, the Wilmington-headquartered firm said its revenue climbed 63% on a year-over-year basis to a record $1.9 billion, indicating continued AI-driven demand for its custom chips.
MRVL is “growing like a weed” and the semiconductor stock should, therefore, be owned for the long term, said famed investor Jim Cramer following the company’s latest earnings release.
Cramer remains constructive on MRVL shares, particularly because the chipmaker is working with hyperscalers, including Amazon.com Inc., on custom AI chips.
His bullish call on Marvell Technology is in line with Wall Street analysts as well.
The consensus rating on the Nasdaq-listed firm currently sits at “buy” with the mean target of about $90, indicating potential upside of another 18% from here.
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