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Actionable news in AVGO: Avago Technologies Limited,

Don't Expect Many Surprises From Marvell Technology's Q2 Earnings

Cowen urged investors not to expect many surprises from the second quarter results of Marvell Technology Group Ltd. MRVL. But, the brokerage expects a solid guidance (particularly EPS) to drive Street estimates higher again.

"See no surprises and if anything a smidge of upside to Street revs/EPS $630MM/$0.11 (non-GAAP) given that MRVL guided FQ1 with less than a week remaining in the Q," analyst Timothy Arcuri wrote in a note.

The analyst expects storage segment and networking revenues to grow 2 percent. However, mobile & wireless are expected to fall 41 percent due to exit of mobile handset.

For the third quarter, Arcuri said the Street revenues/EPS (non-GAAP) $641 million/$0.14 is likely on low side and he model EPS of $0.18 on better-than-expected performance in storage and cost savings.

"Relative to forward commentary regarding new CEO Matt Murphy's new "grand plan", initial focus remains on data intensive R&D justification and the degree to which it can be cut (we think ~$250-300MM cut (~$0.55-0.60 EPS) is a veritable layup with $400MM possible)," Arcuri highlighted.

DateFirmActionFromTo
Jul 2016Morgan StanleyMaintainsEqual-weight
Jul 2016UBSMaintainsSell
Jul 2016JefferiesMaintainsHold

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