Now, here's what you 'should' see happen if my experience is correct --- these numbers back up everything we've all thought all this time - the company continues to grow exponentially, yet the stock price reflects more of the problems rather than the company's success. Okay, that's how the market works.
So, now what's the deal going forward? Remember - there are two groups of investors that move stocks -- institutional investors and momentum traders. Institutional investors buy and hold and are responsible for a majority of a stock's support. However, they only buy to a degree and then they're control of the majority of the stock allows the momentum traders to then play with the rest of the float. Look at how AAPL and RIMM traded last year and then now and you can see how important large institutional traders are.
You can then break down the large institutional traders into groups. The mutual funds are part of that group and they are broken down into two basic types -- growth investors and value investors.
A growth fund manager buys stocks he deems are growing faster than their stock price is valuing that growth. A simple way of figuring that is to take a growth rate and if it's larger than it's PE, then that's a quick idea of whether growth fund managers are going to be interested.
A value manager only looks at stocks that trade at a discount to it's sector valuation or its intrinsic value basis - which is totally subjective and up to each manager's interpretation.
Now, that said, where does MRVL fall? Well, after tonight's numbers that back up everything in that Barron's story and continues to support each previous report, MRVL I think right now under $13 is priced at potentially both a value and growth play. The growth rate of this damn company just continues to amaze without it getting any love.
I've said for weeks now about this expected March 22nd/23rd major cycle low coming. I think it's completely supported by the fact that today the indexes all fell below the closing Jan 23rd low but on HIGHER MACD and Stochastic readings. That's called positive divergance and a classic 5th wave setup. Those on the email list already know this.
So, I think you will now start to see MRVL slowly edge upward in a very quiet way - no momentum trading - as large investors now see first hand a full fledged support of that Barron's story thesis. And don't think for a minute that article didn't go unnoticed.
If the market falls into that 1250 to 1270 level on the SPX going into late March, then don't expect much out of MRVL. But after that, then MRVL could take the lead in a new cycle up for semi's.
AI
