This Dividend-Paying Chip Stock Just Doubled and Analysts Say It’s Still 50% Undervalued

Marvell Technology (NASDAQ:MRVL | MRVL Price Prediction) designs custom silicon and networking chips for hyperscaler data centers. The portfolio spans custom AI XPUs, electro-optics, PAM DSPs, and DCI modules, and the company pays a small $0.06 quarterly dividend, an oddity for a stock acting like pure AI growth. CEO Matt Murphy has spent the past year telling investors that AI now represents the majority of data center revenue, and that custom AI design activity sits at an all-time high with over 50 opportunities across more than 10 customers.

MRVL is up 130% year-to-date through May 22, 2026, and 225% over the past year. Bull cases from Forbes and Trefis sketch a path to $400. A more modest stretch target of $300 in 2026 is worth testing.

Wall Street is already behind the stock

The consensus price target is at $177, which is well below the current price. Even the highest price Wall Street price target goes up to $300. That gap signals stale estimates, but most analysts are not asking you to sell anytime soon. There are zero Sell ratings and 24 Buy ratings against just 4 Hold ratings.

Marvell also reported Q4 FY2026 financial results with $2.22 billion of revenue, up 22% year over year. The growth came fron the Data Center business, as expected. I would expect this revenue growth to accelerate if hyperscalers stick to their guns and keep spending more on data centers.

The math for $300 per share

MRVL trades at a forward P/E of 51x on roughly $3.85 in FY2027 EPS. This is quite expensive when you compare it to most other AI hardware stocks, but it’s mostly because the fiscal period ends in January. When you look at FY2028 earnings (ends in January 2028), you’re paying some 35 times that amount.

If custom XPU ramps and operating leverage push FY27 EPS toward $4.00, $300 implies about 75x forward earnings. Rich, but defensible for a company growing revenue at ~40% annually.

The $400 framework requires the same EPS trajectory plus multiple expansion to roughly 100x, or substantially higher FY2027 estimates than Wall Street models. Possible if Celestial AI’s optical interconnect scales and the 3-nanometer XPU enters production in calendar 2026, but it leaves no room for disappointment.

Catalysts that could close the gap

• Custom silicon ramp: Murphy called the Celestial AI deal a transformational milestone for the scale-up interconnect roadmap.
• NVIDIA (NASDAQ:NVDA) NVLink Fusion partnership: validates Marvell’s chiplet approach for custom XPUs.
• Capital return: $1.3 billion in Q3 buybacks alone shrinks share count into a rising earnings stream.
• Industry tailwind: datacenter equipment growth is essentially locked in for the next four to five years at around 25% annually, per PineBridge’s 2026 outlook.

Why $300 is the credible stretch target

MRVL has gained 331% over five years, so a further 45% advance to $300 fits the volatility profile. The $400 case assumes everything breaks right. $300 reads as ambitious-but-credible: it requires Wall Street estimates to catch reality, custom XPU revenue to compound into FY27, and the multiple to hold near current levels. Risks include customer concentration with data center at 73% of revenue and net insider selling across 94 recent transactions. The blueprint to $300 is on the table.

It could happen even earlier if the broader AI rally gets euphoric. Many analysts believe this AI rally is going to reach up to Dot Com levels.