On Investor Day, Maywell (MRVL.US) released a five-year blueprint “higher than Wall Street”: Goldman Sachs did not buy and chose to maintain a “neutral” rating

The Zhitong Finance App learned that on October 6, EST, Maywell Technology (MRVL.US) held an Investor Day in New York, and the long-term goals proposed by management were “higher than Wall Street's unanimous expectations.” However, Goldman Sachs said that the valuation has taken most of its optimism into the stock price. The bank raised its target price from 220 US dollars to 270 US dollars, and the rating remains “neutral.”

An ambitious blueprint for the next five years

On Investor Day, Maywell's management outlined an impactful financial framework for FY2031. Management expects a compound annual revenue growth rate of 55% to 60%, gross profit margin of 56% to 59%, operating margin of 44% to 46%, EPS of about $30, FCF profit margin of over 36%, and return of more than 50% to shareholders.

Underpinning this set of goals is a larger story: Maywell predicts that global data center capital expenditure will expand from about $700 billion in 2025 to more than $3 trillion in 2030, and the share of the top ten hyperscale cloud vendors will continue to rise.

In this context, the company framed the 2030 potential market for artificial intelligence (TAM) of 400 billion US dollars and set itself a revenue opportunity range of 70 billion to 90 billion US dollars.

Three engines: 65% interconnect, 45% exchange and storage, 80% custom chip

Dismantling Mywell's five-year goals, the growth engine is highly focused on the three tracks of AI infrastructure:

Interconnect (Interconnect): TAM is approximately US$65 billion, and the company's FY2031 revenue target is US$37.5 billion, corresponding to a compound annual growth rate of 65%. Management positions this business as the key to breaking the “memory wall” and “copper wall” of AI infrastructure — the combined solutions include leading SerDes, optical module DSP, coherent optical networks, 1.6T to 3.2T optical interconnect solutions, co-packaged optics (CPO), and a “scale-across” architecture that supports long-distance direct connections between AI clusters.

Switching & Storage (Switching & Storage): TAM is about 85 billion US dollars, and the company targets 10 billion US dollars, a compound annual growth rate of 45%. The roadmap includes a 100T single-chip mask extreme switching chip, UALink-based products, and an Ethernet scale-up network (ESUN) roadmap.

Custom Silicon (Custom Silicon): This is the most elastic block — TAM is as high as 235 billion US dollars, the company's revenue target is 30 billion US dollars, and the compound annual growth rate is about 80%. Mywell is driving cloud vendors from “shelf chips” to semi-customized, fully customized solutions, continuing to invest in 3nm, 2nm, and even 14A advanced manufacturing processes, and has established multi-generational partnerships with customers such as Amazon Cloud (AWS), Google, and Nvidia. In addition to customizing XPUs, the company is also targeting a range of “attach (attach)” opportunities such as custom network cards (NICs), CXL-based memory expansion, near-memory computing, AI storage controllers, and inference offload processors.

Notably, management has broken down AI connectivity opportunities into six levels: scale-out, scale-up, scale-across, scale-in, XPU Attach, and custom XPU — meaning that Maywell no longer defines itself as a single category supplier, but an “end-to-end AI connectivity platform” company.

Goldman Sachs: Target price raised, rating unchanged

Goldman Sachs raised Mywell's 12-month price target from $220 to $270 in this report, based on 30 times the valuation multiplier (unchanged) multiplied by the normalized EPS forecast of $9.00 (previously $7.25). At the same time, Goldman Sachs raised EPS expectations by an average of 13% and gave EPS forecasts for FY2030 and FY2031 for the first time, at $21.80 and $30.95, respectively.

However, the ratings remained “neutral.” The reason is straightforward: Based on the closing price of $287.01 on the day the report was released, Maywell's current stock price is about 9.5 times the company's FY2031 EPS target, and the timing and level of visibility of the new design order is limited — the target price of $270 suggests a downside of about 5.9% compared to the current price.

Goldman Sachs said it would take a more positive stance if it could obtain stronger evidence of execution and a clearer path to the volume of key design orders.

Judging from investors' reaction to the 6% rise in stock prices on the same day, the market is clearly more willing to believe in the 55-60% five-year growth blueprint first. Whether Maywell can actually convert multi-generational partnerships with AWS, Google, and Nvidia into $30 billion in custom chip revenue will be the yardstick for testing this blueprint in the next few years.