Morningstar Gives Marvell Technology (MRVL) a Narrow Economic Moat Rating

Marvell Technology, Inc. (NASDAQ:MRVL) is one of the 10 Best Semiconductor Stocks to Buy According to Reddit. Morningstar gives the company a narrow economic moat rating. As per the firm, Marvell Technology, Inc. (NASDAQ:MRVL) has intangible assets in networking chip design, allowing it to compete at the cutting edge and shield its competitive position. Furthermore, the company tends to benefit from switching costs. Morningstar anticipates the company to earn excess returns on invested capital, more likely than not, over the upcoming 10 years.

Marvell Technology, Inc. (NASDAQ:MRVL)’s billions of dollars of cumulative R&D over the previous decade have developed a portfolio of differentiated intellectual property. Through this, the company can build custom and semi-custom designs for myriad applications and customers, added the firm. It expects the data center to remain Marvell Technology, Inc. (NASDAQ:MRVL)’s largest end market. The company’s AI chip sales have been driving impressive growth, and Morningstar maintains its long-term confidence in the rapid and growth runway for its AI portfolio.

ClearBridge Investments, an investment management company, released its Q2 2025 investor letter. Here is what the fund said:

“We also added a starter position in Marvell Technology, Inc. (NASDAQ:MRVL) in June. Marvell is a company we have been tracking through our ownership of Nvidia and work on the AI semiconductor complex over the last several years. Similar to Broadcom, Marvell designs chips and networking equipment that power technologies like AI, cloud computing and 5G infrastructure and has a particularly strong interconnect business. While Marvell has a high-quality asset portfolio to compete in the custom application-specific integrated circuits (ASICs) chip business, the stock has lagged AI accelerator peers like Nvidia and Broadcom as its ramp in AI revenue has been slower than others in the ecosystem. We believe this dynamic can reverse in coming years as more of Marvell’s customer wins ramp up. Marvell’s valuation has compressed significantly over the past six to nine months and the stock now trades at a healthy growth-adjusted discount to AI semi peers, providing an attractive entry point.”

While we acknowledge the potential of MRVL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.