Citadel Maintains Neutral on Marvell Technologies

Citadel is out with its report today on Marvell Technologies MRVL, maintaining Neutral. In a note to clients, Citadel writes, "Year to date, Marvell has been among the worst performing names in our universe, down 23% vs. a 5% increase for the rest of our coverage. At issue have been concerns over the health of the PC market, and by extension the HDD segment (~40% of sales), as well as a sharp falloff in sales to RIM, due to a shift in demand away from models using Marvell silicon. However, with the stock trading at 10x Street EPS est. for CY11, seemingly widespread agreement on a lackluster PC market in 2011, and greater visibility into the negative near term dynamics at RIM, the stock seems poised to rally post earnings on Thurs. While we can't deny the appeal of a name where expectations are already (or soon to be) reset, esp. in the context of our negative sector view, we think a more questionable fundamental picture long term outweighs the benefits of the near term positioning." Citadel has an $18 PT on MRVL. Shares of MRVL closed Tuesday at $14.20, down 0.94% from Monday's close.