Marvell Joins the S&P 500 as We Await Micron’s ‘All-Star’ Earnings
Marvell Technology ($MRVL) officially joined the S&P 500 Monday morning, but that news is likely being overshadowed by reports that Marvell CFO Willem Meintjes filed last week to sell approximately 211,000 shares of stock. That’s more than a pretty penny given where MRVL shares are trading, but what’s not getting as much attention in some circles is that on June 11, Marvell announced Meintjes is stepping down. He is being replaced by incoming CFO Dan Durn, formerly of Adobe ($ADBE), who started effective mid-June.
One item that regular Pro Portfolio readers can quibble about is our MRVL price target. Several weeks back, we lifted our target to $225, but the combination of Nvidia ($NVDA) CEO Jensen Huang calling Marvell the next trillion-dollar market company and the stock being added to the S&P 500 was more than a bit explosive. We’re not complaining, we’re just going to ask that you be patient with us as we look to earnings this week from EPS All-Stars resident Micron Technology ($MU) and a few other items before recasting our MRVL price target.
To say MU shares have been a stalwart for the EPS All-Stars strategy doesn’t do them justice, but it also overshadows the performance of Bloom Energy ($BE) and Credo Technology ($CRDO). Shares of those two model basket residents are also up triple-digits quarter to date, helping MU drive the overall model up more than 80% quarter to date, as I write this.
When Micron reports after Wednesday’s market close, it is widely expected to benefit from the memory capacity shortage and favorable pricing environment. Consensus figures call for Micron to deliver EPS of $20.05 on revenue of $35 billion for the May quarter, and guide to EPS of $24.21 on revenue of $41.8 billion for the August 2026 quarter. Given the rocket ship ride MU has been on and its track record of handily beating consensus estimates, we could see the shares fall victim to those whisper numbers that have been a nuisance to NVDA shares in recent quarters.
Micron and Capex Comments
The attention on the current memory shortage and tight capacity has been getting more attention of late, thanks to comments last week from outgoing Apple ($AAPL) CEO Tim Cook about forthcoming product price increases. The memory shortage was telegraphed long before Cook’s comments, and it’s one that is expected to weigh on smartphone, PC and other connected device shipments this year and into 2027.
That pain point was one of the reasons why we added Applied Materials ($AMAT) back to the Portfolio back in late March at $363.14. With a relative strength index of more than 77, AMAT shares are overbought and if we see that condition deepen further ahead of Micron’s earnings, we may opt to do some prudent register ringing given the risk of potentially aggressive whisper numbers for Micron. The concern is that missing those aggressive numbers could weigh not only MU but other stocks that have climbed alongside it like AMAT.
To us, the important thing to watch from Micron when it comes to our AMAT position is what is said about capital spending plans. The last comment from Micron in mid-March was that it plans to spend more than $25 billion during its fiscal 2026. We would be surprised if Micron doesn’t up that guidance, and if we’re right, that’s another reason to remain bullish on AMAT.
The logical question that is probably running through you mind is this one: If AMAT shares fall after Micron earnings, would the Portfolio be inclined to add?
If that is what happens, let’s see where they decline to and settle out.
Micron and the EPS All-Stars Model
Because the Portfolio’s exposure to Micron is through the EPS All-Stars model, if we see a sharp post-earnings selloff, the rules of the model’s strategy will keep our hands tied. However, remember that we have the next quarterly reconstitution of the model coming next week.
We still have a few hundred companies to screen before that reconstitution. While we can’t guarantee Micron will make the cut for Q3 2026, with the company expected to deliver EPS of $61 in 2026 and $118 in 2027 from $8.29 in 2025, we can’t rule it out either.
More Pro Portfolio:
- We’re Unwinding Our Hedging Positions, Adding to Two Others
- Tracking 21 Signals Across 10 of Our Investing Themes
- Weekly Roundup: Peace Deal, Warsh Arrives, and the Portfolio Moves Ahead
At the time of publication, TheStreet Pro Portfolio was long AMAT, BE, CRDO, MRVL, MU and NVDA.
