Marvell (MRVL) Stock Analyzer Report

7/27/2019 Marvell (MRVL) Stock Analyzer Report

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Marvell Technology Group Ltd.(MRVL)

Figures in Millions except per share values

Company Overview

ValuationCurrent Price 13.04$ Margin of SafetyNCAV 3.35$

Total Net Reprod. Cost 10.37$Earnings Power Value (EPV) 12.70$

Discounted Cash Flow (DCF) 13.94$Katsenelson Absolute PE 14.56$Ben Graham Formula 15.55$

Key Statistics Company StatsMkt Cap ($M) 6,548.43$ Shares Outstanding 502.2

52 Wk High 13.51$ Shares Float 374.152 Wk Low 6.98$ Insider Ownership 9.50%% off 52Wk Low 86.8% Insider Transactions -3.1%

Institutional Ownersh 68.4%

Cash Flows Float Short 1.5%

Owner Earnings FCF Short Ratio 0.95 yr FCF Growth 34.9% Piotroski (TTM) 7

10 yr FCF Growth 18.3% Altman (MRQ) 6.1 Fundamental Ratios 2012 2013 TTMBeneish (TTM) -2.8 P/E 15.80 17.19 27.13

Effectiveness P/E (cash adjusted) 12.14 10.93 20.00CROIC Margins & Profitability EV/EBITDA 10.07 7.65 12.54

Avg 17.6% Gross EV/Free Cash Flow 8.31 9.73 12.65

FCF/S Gross Margin 52.9% P/S 2.86 1.66 2.12

Avg 17.6% Operating P/BV 1.94 1.18 1.51

ROA Operating Margin 8.0% P/Tang BV 3.42 2.23 2.95

Avg 6.8% Net Profit P/CF 10.94 8.97 11.92

ROE Net Margin 8.5% P/OwnerEarnings 10.81 15.29 17.16

Avg 8.0% ROE 12.3% 6.8% 6.1%Financial Strength (MRQ) ROA 10.7% 5.8% 5.2%

Efficiency Current Ratio(MRQ) 4.0 ROIC 20.5% 10.6% 8.9%Receivables Turnover (TTM) 8.9 Quick Ratio(MRQ) 3.6 CROIC 30.6% 12.6% 13.8%

Inventory Turnover (TTM) 5.4 LTD/Eq(MRQ) 0.0 Current Ratio 5.22 4.25 4.00Days Sales Outstanding (TTM) 43.5 Tot D/Eq(MRQ) 0.0 Total Debt/Equity Ratio 0.00 0.00 0.00

Inventory Turnover 4.89 4.94 5.40

Marvell Technology Group Ltd. designs, develops, and markets analog, mixed-signal,digital signal processing, and embedded and standalone ARM-based microprocessorintegrated circuits. It offers mobile and wireless products comprising communicationsand applications processors; thin modems; W i-Fi and other communication protocols,including Bluetooth, NFC, and/or FM; and mobile computing products. The companyalso provides a range of integrated data storage products, including hard disk drive,

solid-state drive, and hybrid hard disk drive controllers, as well as storage-systemproducts. In addition, it offers networking products comprising cloud infrastructureproducts for home, private, and public cloud networks; and service providerinfrastructure technologies used in the deployment of residential fiber accessinfrastructure and mobile Internet infrastructure, as well as products used in thetransition to Internet protocol radio access networks. Further, the company providesprinter-specific standard SoC products, as well as custom printer ASICs; and powerlineroducts for home networkin and advanced meterin infrastructure DSP Switcher and

August 16, 2013

Selected Financial Statements

0

1

2

3

4

5Low Risk

High Growth

Under Valued

Well Managed

Good Financials

Strong Moat

-100.0%

-25.6%

-2.6%

6.5%

10.5%

16.2%

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

Aug-02 Aug-04 Aug-06 Aug-08 Aug-10 Aug-12

Price vs DCF Intrinsic Value

Stock Price Intrinsic Value Buy Price

(In Millions, Except per Share Amounts) 2009 2010 2011 2012 2013 TTM/Latest

Revenue 2,951$ 2,808$ 3,612$ 3,393$ 3,169$ 3,107$Gross Profit 1,524$ 1,581$ 2,139$ 1,927$ 1,675$ 1,644$

Margin % 51.65% 56.30% 59.21% 56.80% 52.87% 52.92%

R&D 930$ 828$ 898$ 1,014$ 1,057$ 1,081$Margin % 31.52% 29.50% 24.85% 29.88% 33.37% 34.78%

Operating Income 175$ 334$ 901$ 604$ 295$ 244$Margin % 5.93% 11.90% 24.95% 17.81% 9.30% 7.84%

Net Income 147$ 353$ 904$ 615$ 307$ 265$Margin % 4.99% 12.59% 25.03% 18.13% 9.68% 8.54%

Earnings Per ShareBasic 0.24$ 0.57$ 1.39$ 1.01$ 0.55$ 0.49$Diluted 0.23$ 0.54$ 1.34$ 0.99$ 0.54$ 0.48$

Weighted Average Diluted SharesOutstanding 630.33 653.47 676.88 623.27 563.12 505.39

Dividends Per Share -$ -$ -$ -$ 0.18$ 0.26$Dividend Yield 0.00% 0.00% 0.00% 0.00% 1.87% 1.96%Net Cash From Operating Activities 681$ 812$ 1,194$ 771$ 729$ 614$

(Dollars in Millions)

Net Property, Plants & Equipment 391$ 342$ 358$ 384$ 387$ 385$Total Assets 4,414$ 5,171$ 6,338$ 5,768$ 5,262$ 5,121$Long-term Debt 175$ 186$ 176$ 164$ 169$ 156$Stockholders' Equity 3,829$ 4,418$ 5,522$ 5,014$ 4,485$ 4,352$
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arvell Technology Group Ltd.

MRVL) Color Coding

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 T

nancial Statist ics & Ratios

Valuation Ratios

P/E 125.88 69.99 62.15 -862.15 -55.30 34.42 32.63 14.37 15.80 17.19

P/E (cash adjusted) 117.39 65.33 59.37 -812.84 -49.79 28.12 27.55 11.13 12.14 10.93

EV/EBITDA 30.50 31.83 38.30 38.57 37.21 9.68 17.95 9.37 10.07 7.65

EV/Free Cash Flow 63.05 33.45 42.32 28.51 31.86 11.44 19.71 9.22 8.31 9.73

P/S 6.99 8.10 12.33 4.66 2.19 1.72 4.11 3.60 2.86 1.66

P/BV 2.61 3.97 6.76 3.23 1.85 1.32 2.61 2.35 1.94 1.18

P/Tang BV 9.95 10.58 14.97 15.59 6.43 3.28 5.15 3.83 3.42 2.23

P/CF 22.36 26.58 33.27 -12.88 13.12 8.74 15.87 10.33 10.94 8.97

P/OwnerEarnings 67.22 35.73 44.21 28.97 33.08 13.59 23.35 11.91 10.81 15.29

ROE 2.1% 5.7% 10.9% -0.4% -3.4% 3.8% 8.0% 16.4% 12.3% 6.8%

ROA 1.9% 5.1% 9.4% -0.3% -2.5% 3.3% 6.8% 14.3% 10.7% 5.8%

ROIC 2.2% 7.2% 14.1% -3.5% -3.1% 4.9% 12.3% 32.3% 20.5% 10.6%

CROIC 4.6% 14.5% 20.6% 11.2% 5.7% 12.1% 17.6% 39.4% 30.6% 12.6%

GPA (Gross Profitability to Assets) 18.0% 23.0% 25.4% 25.1% 30.7% 34.5% 30.6% 33.7% 33.4% 31.8%

Book to Market 38.2% 25.2% 14.8% 30.9% 53.9% 75.6% 38.3% 42.5% 51.6% 85.1%

Solvency

Quick Ratio 2.94 4.14 3.87 1.55 1.86 3.05 3.93 5.41 4.62 3.84

Current Ratio 3.44 4.74 4.51 1.90 2.58 3.81 4.35 5.79 5.22 4.25

Total Debt/Equity Ratio 0.00 0.01 0.01 0.13 0.12 0.03 0.00 0.00 0.00 0.00

Long Term Debt/Equity Ratio 0.00 0.00 0.00 0.12 0.11 0.03 0.00 0.00 0.00 0.00

Short Term Debt/Equity Ratio 0.00 0.01 0.01 0.01 0.00 0.00 0.00 0.00 0.00 0.00

Efficiency Ratios

Asset Turnover 0.34 0.44 0.48 0.49 0.64 0.67 0.54 0.57 0.59 0.60

Cash % of Revenue 27.4% 13.6% 20.9% 25.4% 21.3% 31.4% 39.4% 51.1% 23.1% 23.7%

Receivables % of Revenue 16.7% 16.4% 14.7% 14.7% 11.8% 7.5% 12.7% 12.7% 12.0% 10.4%

SG&A % of Revenue 9.9% 8.9% 7.4% 13.0% 12.1% 9.0% 11.1% 7.2% 7.7% 8.5%

R&D % of Revenue 26.1% 21.5% 18.6% 29.4% 34.2% 31.5% 29.5% 24.9% 29.9% 33.4%

Liquidity Ratios

Days Sales Outstanding 60.8 59.9 53.6 53.6 43.2 27.5 46.4 46.4 43.8 38.0

Days Inventory Outstanding 87.7 80.9 99.3 82.1 102.2 79.5 71.8 60.8 88.2 61.2

Days Payable Outstanding 115.7 81.4 92.4 81.3 56.3 35.6 82.5 82.3 75.9 70.0

Cash Conversion Cycle 32.7 59.4 60.5 54.4 89.1 71.4 35.7 25.0 56.1 29.2

Receivables Turnover 6.01 7.26 7.49 7.80 8.63 10.46 9.70 8.85 7.83 8.59

Inventory Turnover 4.16 5.27 4.56 4.80 4.49 3.91 4.44 6.05 4.89 4.94

Average Age of Inventory (Days) 87.65 69.23 79.96 76.10 81.26 93.40 82.13 60.33 74.65 73.87

Intangibles % of Book Value 73.7% 62.5% 3.7% 18.0% 12.7% 7.5% 4.1% 2.3% 2.8% 2.0%

Inventory % of Revenue 11.2% 10.5% 12.7% 11.1% 14.5% 10.5% 8.6% 6.8% 10.4% 7.9%

Capital Structure Ratios

LT-Debt as % of Invested Capital 0.0% 0.0% 0.0% 12.3% 11.7% 4.0% 0.0% 0.0% 0.0% 0.0%

ST-Debt as % of Invested Capital 0.6% 0.7% 0.7% 0.5% 0.1% 0.1% 0.1% 0.0% 0.0% 0.0%

LT-Debt as % of Total Debt 0.0% 0.0% 0.0% 95.8% 99.4% 98.6% 0.0% 0.0% 0.0% 0.0%

ST-Debt as % of Total Debt 100.0% 100.0% 100.0% 4.2% 0.6% 1.4% 100.0% 100.0% 0.0% 0.0%

Total Debt % of Total Assets 0.4% 0.5% 0.5% 9.1% 8.6% 2.8% 0.0% 0.0% 0.0% 0.0%

Working Capital % of Price 7.8% 8.1% 5.7% 6.1% 14.5% 22.7% 16.5% 23.6% 25.6% 37.5%

Quality Scores

Piostroski F Score 6.00 7.00 7.00 4.00 5.00 8.00 7.00 8.00 6.00 6.00

Altman Z Score (Original) 14.31 21.12 27.60 5.31 3.95 6.15 10.34 11.33 9.52 5.73

Altman Z Score (Revised) 25.07 37.39 49.00 8.96 6.57 10.69 18.82 21.22 17.84 10.93

Beneish M Score (5 Variable) - -2.65 -2.82 -2.48 -2.87 -3.29 -2.56 -2.87 -2.88 -2.96Beneish M Score (8 Variable) - -2.23 -2.44 -3.05 -2.66 -3.23 -2.42 -2.45 -2.63 -3.03

6/2013

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Marvell Technology Group Ltd.(MRVL)8/16/2013

http://tinyurl.com/6p394ap

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM/MRQ

Balance Sheet Accrual Ratio - 17.0% 14.6% 12.3% 3.8% -5.2% 9.1% 10.3% 14.0% -12.5% 0.7%

Cash Flow Accrual Ratio - 12.4% 11.7% 6.8% -3.4% -15.1% 9.0% 6.9% 11.0% -15.1% -11.1%

Sloan Accrual Ratio 1.1% 9.6% 8.4% 4.3% -2.3% -10.6% 5.5% 3.8% 7.5% -11.4% -8.1%

Earnings 0.08$ 0.24$ 0.52$ (0.02)$ (0.19)$ 0.23$ 0.54$ 1.34$ 0.99$ 0.54$ 0.48$Stock Price 10.4$ 16.6$ 32.6$ 17.8$ 10.7$ 8.0$ 17.7$ 19.2$ 15.6$ 9.4$ 13.0$

Total Assets 2,435.5$ 2,789.0$ 3,513.3$ 4,527.7$ 4,550.6$ 4,414.2$ 5,170.9$ 6,338.2$ 5,767.6$ 5,261.8$ 5,121.2$

Cash & Equivalent 224.4$ 166.5$ 348.4$ 568.0$ 615.6$ 927.4$ 1,105.4$ 1,847.1$ 784.9$ 752.0$ 594.4$Total Liabilities 244.6$ 291.5$ 467.2$ 1,300.5$ 1,139.1$ 585.1$ 753.0$ 816.3$ 753.6$ 777.2$ 768.7$

Short Term Debt 10.7$ 13.2$ 16.6$ 17.4$ 2.5$ 1.8$ 1.9$ 0.5$ -$ -$ -$Long Term Debt -$ -$ -$ 394.8$ 390.8$ 123.4$ -$ -$ -$ -$ -$

Net Operating Assets (NOA) 1,977.2$ 2,344.2$ 2,714.2$ 3,071.3$ 3,189.1$ 3,026.8$ 3,314.5$ 3,675.3$ 4,229.1$ 3,732.6$ 3,758.0$

Net Income 45.5$ 141.7$ 331.4$ (12.1)$ (114.4)$ 147.2$ 353.5$ 904.1$ 615.1$ 306.6$ 265.3$

CFO 149.8$ 221.5$ 402.3$ 337.3$ 177.4$ 680.7$ 811.5$ 1,193.5$ 771.2$ 729.0$ 614.2$

CFI (130.7)$ (348.1)$ (367.5)$ (544.7)$ (185.1)$ (64.7)$ (744.0)$ (529.3)$ (590.1)$ 178.8$ 68.1$

Balance Sheet Aggregate Accrual -$ 367.0$ 370.1$ 357.1$ 117.8$ (162.3)$ 287.7$ 360.8$ 553.8$ (496.5)$ 25.4$Cash Flow Aggregate Accrual -$ 268.3$ 296.6$ 195.3$ (106.6)$ (468.7)$ 286.0$ 239.9$ 433.9$ (601.3)$ (417.0)$

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM

Piotroski F Scores 6 7 7 4 5 8 7 8 6 6 7

Piotroski 1: Net Income 1 1 1 0 0 1 1 1 1 1 1Piotroski 2: Operating Cash Flo 1 1 1 1 1 1 1 1 1 1 1

Piotroski 3: Return on Assets 1 1 1 0 0 1 1 1 0 0 0

Piotroski 4: Quality of Earnings 1 1 1 1 1 1 1 1 1 1 1

Piotroski 5: LT Debt vs Assets 1 1 1 0 1 1 1 1 1 1 1

Piotroski 6: Current Ratio 1 1 0 0 1 1 1 1 0 0 0

Piotroski 7: Shares Outstandin 0 0 0 1 0 0 0 0 1 1 1Piotroski 8: Gross Margin 0 0 1 0 0 1 1 1 0 0 1Piotroski 9: Asset Turnover 0 1 1 1 1 1 0 1 1 1 1

Earnings Quality Check with Accrual Analysis

Z = 1.2*X1 + 1.4*X2 + 3.3*X3 + 0.6*X4 + 1.0*X5

There is also a revised Altman Z score which is adjusted for non manufacturing corporations. The revised formula is:

Z = 6.56*X1 + 3.26*X2 + 6.72*X3 + 1.05*X4

A discrete score between 0-9 which reflects nine criteria u sed to determine the strengt h of a firm's financial position. The Piotroski score is used to determine the best value stocks, nine b eing the best.

The score was named after Chicago Accounting Professor, Joseph Piotroski who devised the scale according to specific criteria found in the financial statements. For every criteria (below) that is metthe company is given one point, if it is not met, then no points are awarded. The points are then added up to determine the best value stocks.

Profitability

* Positive return on assets in the current year(1 point)

* Positive operating cash flow in the current year (1 point)

* Higher return on assets (ROA) in the current period compared to the ROA in the previous year (1 point)

* Cash flow from operations are greater than ROA (1 point)

Leverage, Liquidity and Source of Funds

* Lower ratio of long term debt to in the current period compared value in the previous year (1 point)

* Higher current ratio this year compared to the previous year (1 point)

* No new shares were issued in the last year (1 point)

Operating Efficiency

* A higher gross margin compared to the previous year (1 point)

* A higher asset turnover ratio compared to the previous year(1 point)

Piotroski Score

Earnings growth due to accrual growth is not sustainable. This is like cookie jar accounting where a company borrows earnings from the future to make earnings look good today.

Balance sheet accrual can indicate whether capital is being used properly. A company with high accruals can come from acquiring or merging with companies which expands the asset base. Low

balance sheet accrual companies tend to shrink their balance sheet through spin offs, share repurchases or large write offs. In these situations, it is usually removing bad performing assets or returningmoney to shareholders which is always a good use of capital.

High accruals indicate that the company has expanded its asset base rapidly.

Companies with high balance sheet accruals tend to have higher sales growth than low balance sheet accrual companies.

High balance sheet accruals also have a higher ROE.

Remember that maintaining a high sales growth or high ROE is difficult unless you have an entrenched moat. Such companies revert to the mean and disappoint..

Companies with low balance sheet accruals tend to have below average returns on equity. Analysts expect the company to lag.

Color Coding:Green = safe zone,Yellow = ratio is getting into warning zone, Red = Danger zone. Ratios are too high or low. Requires check.

More readin :

The Z-score formula may be used to predict the probability that a firm will go into bankruptcy within two years.

Z-scores are used to predict corporate defaults and an easy-to-calculate control measure for the financial distress status of companies in academic studies. The Z-score uses multiple corporate incomeand balance sheet values to measure the financial health of a company.

The main problem with the Altman Z formula is that the formula is not suited for many industries. Industries that operate with high leverage, such as radio and utilities will show a higher risk of

bankruptcy.

Also, industries with negative wor king capital, such as many retail and restaur ant companies will also exhibit the same high lev el of bankruptcy.

(Wikipedia http://en.wikipedia.org/wiki/Z-Score_Financial_Analysis_Tool)

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Altman Z Score

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MRQ2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Q1

Working Capital 449.4$ 803.0$ 1,167.1$ 636.8$ 920.5$ 1,150.7$ 1,898.9$ 3,072.0$ 2,489.4$ 1,977.5$ 1,839.8$

Total Assets 2,435.5$ 2,789.0$ 3,513.3$ 4,527.7$ 4,550.6$ 4,414.2$ 5,170.9$ 6,338.2$ 5,767.6$ 5,261.8$ 5,121.2$

Total Liabilities 244.6$ 291.5$ 467.2$ 1,300.5$ 1,139.1$ 585.1$ 753.0$ 816.3$ 753.6$ 777.2$ 768.7$

Retained Earnings (674.8)$ (533.1)$ (201.8)$ (576.5)$ (691.0)$ (543.7)$ (190.3)$ 713.9$ 1,329.0$ 1,536.8$ 1,559.7$

EBITDA 63.4$ 169.5$ 379.1$ 24.8$ (67.7)$ 188.8$ 344.8$ 910.6$ 619.1$ 310.2$ 46.0$

Market Value of Equity 5,728.7$ 9,915.2$ 20,593.5$ 10,427.6$ 6,328.1$ 5,067.8$ 11,533.8$ 12,989.3$ 9,716.7$ 5,270.8$ 6,548.4$

Net Sales 819.8$ 1,224.6$ 1,670.3$ 2,237.6$ 2,894.7$ 2,950.6$ 2,807.7$ 3,611.9$ 3,393.0$ 3,168.6$ 734.4$

Normal Altman Z Score 14.31 21.12 27.60 5.31 3.95 6.15 10.34 11.33 9.52 5.73 6.14 Revised Altman Z Score 25.07 37.39 49.00 8.96 6.57 10.69 18.82 21.22 17.84 10.93 12.35

X1 0.38 0.36X2 0.29 0.30

X3 0.06 0.01X4 6.78 8.52X5 0.60 0.14

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM

M Score - 5 Variable - -2.65 -2.82 -2.48 -2.87 -3.29 -2.56 -2.87 -2.88 -2.96 -2.80

M Score - 8 Variable - -2.23 -2.44 -3.05 -2.66 -3.23 -2.42 -2.45 -2.63 -3.03 -2.69

DSRI - 0.99 0.89 1.00 0.81 0.64 1.69 1.00 0.94 0.87 1.14GMI - 1.02 0.98 1.05 1.05 0.93 0.92 0.95 1.04 1.07 1.00

AQI - 0.85 0.86 1.21 0.96 0.97 0.82 0.78 1.12 1.09 1.02

SGI - 1.49 1.36 1.34 1.29 1.02 0.95 1.29 0.94 0.93 0.98

DEPI - 1.01 1.20 1.23 0.77 0.95 1.07 1.16 1.23 0.98 0.99SGAI - 0.90 0.84 1.74 0.93 0.75 1.23 0.65 1.06 1.11 1.02

TATA - -0.03 -0.02 -0.08 -0.06 -0.12 -0.09 -0.05 -0.03 -0.08 -0.07LVGI - 1.02 1.23 2.58 0.88 0.56 0.91 0.92 1.01 1.13 1.04

Revised Altman Z Score

X1 = Working Capital/Total Assets

Original Altman Z Score

MRQ Annual MRQ

10.93

Annual

5.73

MRQ Edit

6.14

Revised Altman Z Score

12.35

Altman Z Score

The Beneish Model - M Score VariablesDSRI = Days' Sales in Receivables Index. Measured as the ratio of days' sales in receivables in year t to year t-1. A large increase in DSR could be indicative of revenue inflation.

GMI = Gross Margin Index. Measured as the ratio of gross margin in year t-1 to gross margin in year t. Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more

likely to manipulate earnings.

AQI = Asset Quality Index. Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.AQI is the ratio of asset quality in year t to year t-1.

SGI = Sales Growth Index. Ratio of sales in year t to sales in year t-1. Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to

manipulate in order to keep up appearances.

DEPI = Depreciation Index. Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t. DEPI greater than 1 indicates that assets are being depreciated at a slower

rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

SGAI = Sales, General and Administrative expenses Index. The ratio of SGA expenses in year t relative to year t -1.

LVGI = Leverage Index. The ratio of total debt to total assets in year t relative to yeat t-1. An LVGI >1 indicates an increase in leverage

TATA - Total Accruals to Total Assets. Total accruals calculated as the change in working capital accounts other than cash less depreciation.

Annual

When Z is 1.8 to 2.7, the company is likely to be bankrupt within 2 years. This is the lower portion of the grey area and a dramatic turnaround of the company is needed.

When Z is below 1.1, the company is highly likely to be bankrupt. If a company is generating lower than 1.8, serious studies must be performed to ensure the company can survive.

When Z is 3.0 or more, the firm is most likely safe based on the financial data. However, be careful to double check as fraud, economic downturns and other factors could cause

unexpected reversals.

When Z is 2.7 to 3.0, the company is probably safe from bankruptcy, but this is in the grey area and caution should be taken.

When Z is below 1.8, the company is highly l ikely to be bankrupt. I f a company is generating lower than 1.8, serious studies must be performed to ensure the company can survive.

X2 = Retained Earnings/Total Assets

X3 = EBITDA/Total Assets

When Z is 1.1 to 2.6, the company is probably safe from bankruptcy, but this is in the grey area and caution should be taken.

X5 = Net Sales/Total Assets

When Z is 2.6 or more, the firm is most likely safe based on the financial data. However, be careful to double check as fraud, economic downturns and other factors could cause unexpected reversals.

X4 = Market Value of Equity/Total Liabilities

The Beneish M Score FormulaThe eight variables are then weighted together according to the following:

M = -4.84 + 0.92*DSRI + 0.528*GMI + 0.404*AQI + 0.892*SGI + 0.115*DEPI - 0.172*SGAI + 4.679*TATA - 0.327*LVGI

A score greater than -2. 22 indicates a strong likelihood of a firm being a manipulator. In his out of sample tests, Beneish found tha t he could correctly identify 76% of manipulators, whilst only incorrectlyidentifying 17.5% of non-manipulators.

The 5 Variable Version of the Beneish ModelThe five variable version excludes SGAI, DEPI and LEVI which were not significant in the original Beneish model.

M = -6.065 + 0.823*DSRI + 0.906*GMI + 0.593*AQI + 0.717*SGI + 0.107*DEPI

A score greater than -2. 22 indicates a strong likelihood of a firm being a manipulator.


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Marvell Technology Group Ltd.

Figures in Millions except per share values

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM$54.6 $175.8 $302.8 $148.6 $40.7 $602.2 $756.1 $1,080.2 $668.6 $625.8 $506.0 $85.2 $277.5 $465.8 $359.9 $191.3 $373.0 $494.0 $1,091.1 $898.5 $344.7 $384.0

% Change 222.1% 72.3% -50.9% -72.6% 1379.2% 25.5% 42.9% -38.1% -6.4% -19.1% % Change 225.6% 67.9% -22.7% -46.9% 95.0% 32.4% 120.8% -17.6% -61.6% 11.4%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM$85.2 $277.5 $465.8 $359.9 $191.3 $373.0 $494.0 $1,091.1 $898.5 $344.7 $384.0 $0.08 $0.24 $0.52 -$0.02 -$0.19 $0.23 $0.54 $1.34 $0.99 $0.54 $0.48

% Change 225.6% 67.9% -22.7% -46.9% 95.0% 32.4% 120.8% -17.6% -61.6% 11.4% % Change 187.8% 121.6% -103.9% -839.4% 220.5% 131.5% 147.0% -26.1% -44.8% -11.7%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM10.4% 22.7% 27.9% 16.1% 6.6% 12.6% 17.6% 30.2% 26.5% 10.9% 12.4% 105.0 56.4 68.0 70.2 155.4 8.4 15.3 12.0 14.5 8.4 13.0

% Change 118.0% 23.1% -42.3% -58.9% 91.3% 39.2% 71.7% -12.3% -58.9% 13.6% % Change -46.3% 20.6% 3.2% 121.5% -94.6% 81.3% -21.2% 20.9% -42.0% 54.6%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM4.6% 14.5% 20.6% 11.2% 5.7% 12.1% 17.6% 39.4% 30.6% 12.6% 13.8% 1.0% 1.8% 1.5% 1.4% 0.6% 11.9% 6.6% 8.3% 6.9% 11.9% 7.7%

% Change 217.3% 42.2% -45.8% -48.7% 111.4% 45.2% 124.1% -22.3% -58.9% 9.8% % Change 86.1% -17.1% -3.1% -54.8% 1747.0% -44.8% 26.9% -17.3% 72.6% -35.3%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM3.3% 3.1% 2.6% 2.6% 2.7% 10.3% 5.6% 10.7% 9.9% 13.1% 8.0% 10.6% 17.6% 26.5% 2.3% -5.1% 12.2% 15.4% 26.5% 21.5% 13.1% 11.7%

% Change -4.2% -16.9% -0.7% 3.7% 284.4% -46.1% 91.6% -7.0% 31.7% -39.0% % Change 66.1% 51.1% -91.3% -320.1% 341.7% 25.6% 72.5% -18.8% -39.1% -10.5%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM53.4% 52.5% 53.5% 50.8% 48.3% 51.6% 56.3% 59.2% 56.8% 52.9% 52.9% 5.6% 11.6% 19.8% -0.5% -4.0% 5.0% 12.6% 25.0% 18.1% 9.7% 8.5%

% Change -1.7% 1.9% -5.0% -5.1% 7.0% 9.0% 5.2% -4.1% -6.9% 0.1% % Change 108.4% 71.5% -102.7% -631.3% 226.2% 152.3% 98.8% -27.6% -46.6% -11.8%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM6.0 7.0 7.0 4.0 5.0 8.0 7.0 8.0 6.0 6.0 7.0 14.3 21.1 27.6 5.3 3.9 6.1 10.3 11.3 9.5 5.7 6.1

% Change 16.7% 0.0% -42.9% 25.0% 60.0% -12.5% 14.3% -25.0% 0.0% 16.7% % Change 47.6% 30.6% -80.7% -25.7% 55.6% 68.3% 9.6% -16.0% -39.9% 7.3%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM

-2.2 -2.4 -3.1 -2.7 -3.2 -2.4 -2.4 -2.6 -3.0 -2.7 28.2% 16.4% 12.6% 243.4% -5.7% 13.8% -3.0% 0.7% 0.6% 1.2% -1.5%% Change #DIV/0! -9.4% -25.3% 12.8% -21.4% 25.0% -1.0% -7.5% -15.0% 11.1% % Change -41.7% -23.4% 1833.0% -102.3% 341.8% -121.8% 123.1% -7.9% 81.3% -232.1%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM11.2% 11.7% 15.3% 40.3% 33.4% 15.3% 17.0% 14.8% 15.0% 17.3% 17.7% 793.0% 2101.4% 2812.5% 87.3% 48.6% 298.0% ######## ########

% Change 4.5% 31.4% 162.7% -17.1% -54.2% 11.5% -13.3% 1.7% 15.3% 1.9% % Change 165.0% 33.8% -96.9% -44.3% 512.6% 8445.4% 738.4% #V ALUE ! #VA LUE! #V ALUE !

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM793.0% 2101.4% 2812.5% 2067.5% 7766.5% ######## ######## ######## 91.2% 49.0% 302.3%

% Change 165.0% 33.8% -26.5% 275.6% 168.8% 22.0% 738.4% #VALU E! #VA LUE! #V ALUE ! % Change#VALUE! #VALUE! #VALUE! - 46 .3% 517 .6% #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!

Magic Formu la In ves ting -- Earn ings Yield Magic Formula Inves ting -- Return on Capital

Owner Earnings

Debt to Equity FCF to Total Debt

Cash Return on Inves ted Capital (CROIC) FCF Yield

FCF to Shor t Term Debt FCF to Long Term Debt

Gross Marg in Net Pro fi t Marg in

Pio trosk i F score Or ig inal A ltman Z Score

Beneish M Score - 8 Var iab le Vers ion Tax Rate

(MRVL)8/16/2013

Diluted EPS

FCF / Sales Price / FCF

Free Cash Flow

Owner Earnings

Enter Ticker Refresh


6/12

Marvell Technology Group Ltd.MRVL)

MRVL LSI INTC STM QCOM BRCM TXN NVDA SPRD

2 Company Marvell LSI Intel QUALCOMM Broadcom Texas NVIDIA Spreadtrum3 Sector Technology Technology Technology Technology Technology Technology Technology Technology Technology

4Industry

Semiconductor -

Integrated

Circuits

Semiconductor -

Specialized

Semiconductor -

Broad Line

Semiconductor -

Broad Line

Communication

Equipment

Semiconductor -

Integrated

Circuits

Semiconductor -

Broad Line

Semiconductor -

SpecializedSemiconductor

- Broad Line5 Country Bermuda USA USA Switzerland USA USA USA USA China

68 Earnings Date 22-Aug-2013 24-Jul-2013 17-Jul-2013 24-Jan-2011 24-Jul-2013 23-Jul-2013 22-Jul-2013 8-Aug-2013 6-Aug-2013

65 Price $13.04 $7.50 $22.03 $8.43 $66.95 $26.04 $38.65 $15.13 $29.836 Market Cap $6,548.43 $4,112.12 $109,665.34 $7,494.27 $115,622.64 $15,051.12 $42,630.95 $8,856.27 $489.72

66 Change -1.06% -2.47% -2.39% -1.52% -0.01% -1.88% -1.33% 0.67% -0.10%67 Volume 4,426,900 4,375,700 40,440,200 798,900 11,462,800 9,513,300 8,551,200 18,090,400 640,90060 Change from Open -0.23% -1.06% -1.12% 0.48% 0.90% -0.46% -0.05% 1.75% 0.03%61 Gap -0.83% -1.43% -1.28% -1.99% -0.91% -1.43% -1.28% -1.06% -0.13%55 50-Day High -3.48% -5.06% -13.38% -15.16% -0.74% -26.96% -3.35% -2.26% -1.23%56 50-Day Low 23.36% 10.62% -1.26% 1.08% 13.44% 12.00% 14.14% 15.41% 60.11%57 52-Week High -3.48% -7.41% -14.36% -15.16% -1.36% -31.00% -3.35% -2.26% -1.23%

52-Week Low 88.94% 25.21% 18.04% 65.11% 18.41% 12.00% 47.64% 38.12% 108.65%

7 P/E 26.61 39.47 11.91 0.00 17.81 37.20 21.47 16.81 7.468 Forward P/E 13.98 10.52 11.14 12.77 13.59 9.19 17.33 18.27 10.249 PEG 2.66 3.22 1.08 0.00 1.07 2.66 2.39 1.40 0.330 P/S 2.11 1.73 2.10 0.89 4.97 1.81 3.47 2.09 0.571 P/B 1.50 3.61 2.04 1.32 3.08 1.91 3.85 2.12 1.072 P/Cash 3.78 6.11 6.32 4.23 10.09 6.07 13.14 3.02 2.433 P/Free Cash Flow 21.12 16.40 23.58 0.00 24.52 10.25 22.12 0.00 11.774 Dividend Yield 1.84% 1.60% 4.09% 4.74% 2.09% 1.69% 2.90% 1.98% 1.27%

5 Payout Ratio 36.00% 0.00% 35.50% 0.00% 28.50% 56.80% 47.80% 24.70% 68.20%

6 EPS (ttm) $0.49 $0.19 $1.85 ($1.38) $3.76 $0.70 $1.80 $0.90 $4.007 EPS growth this year -45.50% 126.70% -10.90% -281.90% 13.30% -24.20% -19.70% -4.30% -27.80%8 EPS growth next year 10.94% 10.03% 5.50% 700.00% 8.84% 3.39% 15.25% 13.27% 15.73%9 EPS growth past 5 years 37.10% 15.80% 12.50% -19.80% 9.40% 27.60% -3.80% -7.20% 28.50%0 EPS growth next 5 years 10.00% 12.25% 11.00% 5.00% 16.67% 14.00% 9.00% 12.00% 22.78%1 Sales growth past 5 years 1.80% 5.80% 6.80% -3.20% 16.60% 16.20% -1.50% 0.90% 37.90%2 EPS growth quarter over quarter -31.30% -60.00% -27.80% -112.50% 30.40% -253.60% 52.60% -15.80% 370.70%3 Sales growth quarter over quarter -7.80% -10.60% -5.10% -4.80% 35.00% 6.00% -8.60% -6.40% 60.50%

2 Return on Assets 5.00% 4.60% 11.60% -12.20% 14.50% 3.70% 10.20% 9.20% 13.50%3 Return on Equity 5.80% 9.10% 18.50% -20.10% 18.40% 5.30% 18.30% 12.00% 25.70%4 Return on Investment 6.50% 13.70% 16.70% -28.30% 12.90% 7.80% 10.80% 11.30% 19.40%

5 Current Ratio 4.00 2.60 2.60 2.10 3.20 2.40 2.90 4.20 1.606 Quick Ratio 3.60 2.20 2.20 1.50 2.80 2.00 2.30 3.80 1.007 LT Debt/Equity 0.00 0.00 0.24 0.11 0.00 0.18 0.38 0.00 0.118 Total Debt/Equity 0.00 0.00 0.25 0.17 0.00 0.21 0.47 0.00 0.31

9 Gross Margin 52.90% 50.40% 59.00% 32.80% 61.80% 50.50% 49.80% 53.90% 37.40%0 Operating Margin 8.00% 6.60% 23.40% -5.50% 30.60% 11.80% 19.50% 15.00% 12.80%1 Profit Margin 8.50% 4.40% 18.10% -14.70% 28.50% 5.00% 16.50% 13.10% 12.00%

4 Shares Outstanding 502.18 548.28 4,978.00 889.00 1,727.00 578.00 1,103.00 585.35 16.425 Shares Float 374.09 544.72 4,978.89 657.35 1,680.90 527.39 1,100.31 549.98 47.936 Insider Ownership 9.50% 0.30% 0.10% 0.00% 1.25% 0.80% 0.40% 0.20% 41.56%7 Insider Transactions -3.14% 40.84% 11.74% 0.00% -0.59% 34.46% -1.14% 54.71% 0.00%8 Institutional Ownership 68.40% 79.40% 62.60% 2.90% 81.10% 84.80% 86.80% 78.60% 88.50%9 Institutional Transactions 2.99% 2.33% 0.83% -0.64% 1.04% 0.35% 0.12% 0.67% 0.00%0 Float Short 1.54% 1.92% 4.88% 0.27% 1.04% 2.57% 2.10% 6.96% 2.54%1 Short Ratio 0.9 2.1 6.0 1.4 1.3 1.3 3.0 4.3 0.7

2 Performance (Week) 1.72% -2.22% -1.87% -2.88% 0.90% -0.99% -2.52% 2.93% -0.13%3 Performance (Month) 8.58% -1.45% -7.90% -13.80% 6.86% -22.50% 2.71% 3.56% 0.71%4 Performance (Quarter) 16.01% 5.34% -7.09% -7.36% 2.56% -28.58% 6.36% 3.91% 54.64%5 Performance (Half Year) 38.43% 2.88% 5.76% 0.12% 3.11% -24.43% 16.10% 20.17% 89.88%6 Performance (Year) 11.36% -3.10% -14.08% 51.08% 9.68% -24.91% 34.62% 3.99% 70.85%6 Performance (Year) 11.36% -3.10% -14.08% 51.08% 9.68% -24.91% 34.62% 3.99% 70.85%8 Beta 1.21 1.66 1.01 1.74 1.05 1.08 1.08 1.38 1.17

9 Average True Range 0.31 0.17 0.36 0.18 1.05 0.91 0.57 0.39 0.290 Volatility (Week) 2.62% 2.03% 1.46% 1.41% 1.08% 4.22% 1.34% 4.97% 0.54%1 Volatility (Month) 2.36% 2.23% 1.36% 1.59% 1.56% 2.72% 1.35% 2.70% 0.62%2 20-Day Simple Moving Average 3.88% -2.59% -3.34% -4.00% 3.62% -7.60% -0.92% 4.57% 0.04%3 50-Day Simple Moving Average 9.57% 0.87% -6.32% -7.53% 6.80% -17.80% 4.62% 5.17% 12.20%4 200-Day Simple Moving Average 30.29% 6.81% 1.17% 6.02% 5.61% -21.56% 14.42% 15.71% 46.42%9 Relative Strength Index (14) 61.61 43.92 28.59 36.61 64.82 24.62 50.43 65.58 71.792 Analyst Recom 2.80 2.30 2.70 2.00 2.00 2.30 2.80 2.70 2.903 Average Volume 6,194.82 5,092.59 40,597.22 1,233.80 13,648.51 10,128.75 7,710.13 8,889.39 1,638.794 Relative Volume 0.71 0.85 0.99 0.64 0.83 0.95 1.10 2.07 0.39

Enter Competitor Tickers

16/2013

Enter Ticker CLEARUpdate


7/12

Marvell Technology Group Ltd. Shares Out. M.O.S Growth Discount % Terminal % Select FCF Adjust 2013 FCFMRVL) 502.18 502.18 8.0% 9.0%16/2013 Select input with

each list or enter

Current Price Fair Value Buy Under Actual M.O.S 52 Wk High 52 Wk Low

$13.04 13.94$ $6.97 6% $13.51 $6.98

Fiscal Year Trend 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 T

ash Flow Dataash from Operations $149.8 $221.5 $402.3 $337.3 $177.4 $680.7 $811.5 $1,193.5 $771.2 $729.0apex ($95.2) ($45.8) ($99.5) ($188.7) ($136.6) ($78.4) ($55.4) ($113.3) ($102.6) ($103.2)ash Flow $256.3 $373.0 $618.9 ($809.6) $482.2 $579.9 $726.7 $1,258.0 $888.2 $587.4

wner Earnings FCF $85.2 $277.5 $465.8 $359.9 $191.3 $373.0 $494.0 $1,091.1 $898.5 $344.7YOY% Change 225.6% 67.9% -22.7% -46.9% 95.0% 32.4% 120.8% -17.6% -61.6%

arginsoss Margin 53.4% 52.5% 53.5% 50.8% 48.3% 51.6% 56.3% 59.2% 56.8% 52.9%perating Margin 7.0% 13.4% 21.8% 3.5% -3.4% 5.9% 11.9% 25.0% 17.8% 9.3%et Margin 5.6% 11.6% 19.8% -0.5% -4.0% 5.0% 12.6% 25.0% 18.1% 9.7%

PS & Taxuted EPS $0.08 $0.24 $0.52 -$0.02 -$0.19 $0.23 $0.54 $1.34 $0.99 $0.54x Rate 28.2% 16.4% 12.6% 243.4% -5.7% 13.8% -3.0% 0.7% 0.6% 1.2%

fficiency & ProfitabilityROIC 4.6% 14.5% 20.6% 11.2% 5.7% 12.1% 17.6% 39.4% 30.6% 12.6%CF/Sales 10.4% 22.7% 27.9% 16.1% 6.6% 12.6% 17.6% 30.2% 26.5% 10.9%ventory Turnover 4.2 5.3 4.6 4.8 4.5 3.9 4.4 6.1 4.9 4.9eturn On Assets (ROA) 1.9% 5.1% 9.4% -0.3% -2.5% 3.3% 6.8% 14.3% 10.7% 5.8%etun On Equity (ROE) 2.1% 5.7% 10.9% -0.4% -3.4% 3.8% 8.0% 16.4% 12.3% 6.8%

ebt Relatedebt to Equity 11.2% 11.7% 15.3% 40.3% 33.4% 15.3% 17.0% 14.8% 15.0% 17.3%apitalization Ratio 0.0% 0.0% 0.0% 10.9% 10.3% 3.1% 0.0% 0.0% 0.0% 0.0%CF to Total Debt 7.9 21.0 28.1 0.9 0.5 3.0 254.7 2135.1

CF to Short Term Debt 7.9 21.0 28.1 20.7 77.7 208.7 254.7 2135.1CF to Long Term Debt 0.9 0.5 3.0

2008-2012 2009-2013 2008-2011 2009-2012 2010-2013 2008-2010 2009-2011 2010-2012 2011-2013 Median

ng Shareholder Equity 13.1% 5.5% 21.9% 11.2% 1.2% 19.3% 23.4% 7.2% -9.8% 11.2%wner Earnings FCF 47.2% -2.0% 78.7% 34.1% -11.3% 60.7% 71.0% 34.9% -43.8% 34.9%

ROIC 17.6% 17.6% 14.9% 24.1% 24.1% 12.1% 17.6% 30.6% 30.6% 17.6%CF/Sales 17.6% 17.6% 15.1% 22.0% 22.0% 12.6% 17.6% 26.5% 26.5% 17.6%OA 6.8% 6.8% 5.1% 8.7% 8.7% 3.3% 6.8% 10.7% 10.7% 6.8%OE 8.0% 8.0% 5.9% 10.1% 10.1% 3.8% 8.0% 12.3% 12.3% 8.0%oss Margin 56.3% 56.3% 54.0% 56.5% 56.5% 51.6% 56.3% 56.8% 56.8% 56.3%perating Margin 11.9% 11.9% 8.9% 14.9% 14.9% 5.9% 11.9% 17.8% 17.8% 11.9%et Margin 12.6% 12.6% 8.8% 15.4% 15.4% 5.0% 12.6% 18.1% 18.1% 12.6%evenue Growth 4.1% 1.8% 7.7% 4.8% 4.1% -1.5% 10.6% 9.9% -6.3% 4.1%arnings Growth 0.0% 23.6% 0.0% 61.7% 0.2% 0.0% 139.1% 35.1% -36.2% 0.2%ash from Ops Growth 44.4% 1.7% 88.8% 4.3% -3.5% 113.9% 32.4% -2.5% -21.8% 4.3%

0 Year Multi-Year Performance2004-2011 2005-2012 2006-2013 2004-2009 2005-2010 2006-2011 2007-2012 2008-2013 2004-2013 Median

ng Shareholder Equity 37.7% 26.6% 5.9% 43.8% 35.2% 13.0% 13.0% 8.1% 25.3% 25.3%wner Earnings FCF 43.9% 18.3% -4.2% 34.3% 12.2% 18.6% 20.1% 12.5% 16.8% 18.3%ROIC 13.3% 16.0% 15.1% 11.6% 13.3% 14.9% 14.9% 15.1% 17.6% 14.9%CF/Sales 16.8% 20.1% 16.8% 14.4% 16.8% 16.8% 16.8% 15.1% 16.8% 16.8%OA 4.2% 6.0% 6.3% 2.6% 4.2% 5.1% 5.1% 6.3% 5.5% 5.1%

OE 4.8% 6.8% 7.4% 3.0% 4.8% 5.9% 5.9% 7.4% 6.3% 5.9%oss Margin 52.9% 53.0% 53.2% 52.1% 52.1% 52.6% 54.0% 54.6% 53.1% 53.0%perating Margin 9.4% 12.7% 10.6% 6.4% 8.9% 8.9% 8.9% 10.6% 10.6% 9.4%et Margin 8.6% 12.1% 11.1% 5.3% 8.3% 8.8% 8.8% 11.1% 10.6% 8.8%evenue Growth 23.6% 15.7% 9.6% 29.2% 18.1% 16.7% 8.7% 1.8% 16.2% 16.2%arnings Growth 48.9% 22.6% 0.5% 23.2% 18.0% 20.5% 0.0% 0.0% 23.4% 20.5%ash from Ops Growth 34.5% 19.5% 8.9% 35.4% 29.7% 24.3% 18.0% 32.7% 19.2% 24.3%

rojection of future Free Cash Flow2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

early Growth Input Field% $372.23 $402.01 $434.17 $465.43 $498.95 $534.87 $573.38 $610.54 $650.11 $692.24rminal Growth 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033

% 706.08$ 720.20$ 734.61$ 749.30$ 764.28$ 779.57$ 795.16$ 811.06$ 827.29$ 843.83$

alculation Sensitivity Matrix: Growth vs Discount Rate

tal CashAX(0,Current Liabilities-Current 7% 8% 9% 10% 11%xcess Cash 4% 13.13$ 12.35$ 11.66$ 11.05$ 10.51$

dding some Intangibles 6% 14.44$ 13.53$ 12.73$ 12.02$ 11.39$

erest Bearing Debt 8% 15.93$ 14.87$ 13.94$ 13.11$ 12.38$esent Value 10% 17.64$ 16.40$ 15.31$ 14.35$ 13.50$

hares Outstanding 12% 19.57$ 18.14$ 16.88$ 15.76$ 14.78$er Share Value

esired Margin of Safety Sensitivity Matrix: Margin of Safety %urchase Price

urrent Price 7% 8% 9% 10% 11%argin of Safety 4% 0.7% -5.6% -11.8% -18.0% -24.1%

6% 9.7% 3.6% -2.5% -8.5% -14.5%

ariable Fields 8% 18.2% 12.3% 6.4% 0.5% -5.3%angibles% add to DCF 10% 26.1% 20.5% 14.8% 9.2% 3.4%

ecay Rate (Yr4E-Yr7E) 12% 33.4% 28.1% 22.7% 17.3% 11.8%xtra Decay (Yr8E-Yr10E)

502.1813.94$

6,999.34$

10%

6%

2%50%

50%

6.97$

13.04$

Owner Earnings

1,732.64$-$

Year Multi-Year Performance

-$

0%

Discount Rates

Growth Rates

1,732.64$

10%

Discount Rates

Growth Rates

$0.00

Enter Ticker CLEARRefresh


8/12

Shares Out. M.O.S Growth Projection EPS Corp Bond

MRVL) 502.18 10.3% $0.84 4.10

6/2013

Current Price Intrinsic $ Buy Under Actual M.O.S 52 Wk High 52 Wk Low

$13.04 $15.55 $5.29 16% $13.51 $6.98

2008-2012 2009-2013 2008-2011 2009-2012 2010-2013 2008-2010 2009-2011 2010-2012 2011-2013 Medianr EPS Growth 0.0% 23.6% 0.0% 61.7% 0.2% 0.0% 139.1% 35.1% -36.2% 0.2%

2004-2011 2005-2012 2006-2013 2004-2009 2005-2010 2006-2011 2007-2012 2008-2013Yr EPS Growth 48.9% 22.6% 0.5% 23.2% 18.0% 20.5% 0.0% 0.0%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTMued EPS 0.08$ 0.24$ 0.52$ (0.02)$ (0.19)$ 0.23$ 0.54$ 1.34$ 0.99$ 0.54$ 0.4$

2014E 2015E

ecast Method 0.95$ 1.04$ear Regression Method 0.69$ 0.77$alyst Estimate 0.84$ 0.93$

mal Earnings 0.84$wth Rate 10.25%p Bond Rate 4.10Share Value 15.55$S 66%

chase Price 5.29$rent Price $13.04ual Discount 16%

wth Sensitivity Increme 10%S Sensivity Increments 10%

aham's Sensitivity Matrix

Median20.5%

aham Value Calculation

66%502.18AnalystEstimate

arvell Technology Gro


$0.08$0.24

$0.52

$(0.02)$(0.19)

$0.23

$0.54

$1.34$0.99

$0.54

$0.84 $0.93

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

0.67$ 0.76$ 0.84$ 0.92$ 1.01$

8.2% 10.96$ 12.33$ 13.70$ 15.07$ 16.45$

9.2% 11.70$ 13.17$ 14.63$ 16.09$ 17.55$

10.3% 12.44$ 14.00$ 15.55$ 17.11$ 18.66$

11.3% 13.18$ 14.83$ 16.48$ 18.12$ 19.77$

13.5% 14.81$ 16.66$ 18.51$ 20.36$ 22.21$

EPS

Growth


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Marvell Technology Group LCurrent EPS

Exp Growth Dividend Yield

Business

Safety

Financial

Safety

Earnings

Safety

MRVL) 25% 1.84% Average Excellent Below Average/16/2013 Expected PE 10 of 20 pts 20 of 20 pts 9 of 20 pts

10

Katsenelson Absolute PE Current Price Fair Value Fair Value PE Current PE FV Exp Grth M.O.S

$13.04 $14.56 30.30 26.61 25% 10%

etermine Business Risk 2009 2010 2011 2012 2013 TTM AVERAGE STDEV

OE 3.85% 8.00% 16.37% 12.27% 6.84% 6.09% 8.9% 4.6%Consistency/quality check 0 1 0 0 0 1

OA 3.34% 6.84% 14.26% 10.66% 5.83% 5.18% 7.7% 4.0%Consistency/quality check 1 1 0 0 0 2

ROIC 12.12% 17.60% 39.42% 30.65% 12.60% 13.83% 21.0% 11.4%Consistency/quality check 1 1 1 0 1 4

tangibles % of Book Value 7.48% 4.05% 2.26% 2.82% 2.00% 1.89% 3.4% 2.1%Consistency/quality check 1 1 1 1 1 5

usiness Risk Factor: 12 pts out of 20 Above Average 2% Factor 12 0.0%

etermine Financial Risk 2009 2010 2011 2012 2013 TTM AVERAGE STDEVurrent Ratio 3.81 4.35 5.79 5.22 4.25 4.00 4.57 0.77

Consistency/quality check 1 1 1 1 1 5otal Debt/Equity Ratio 0.03 0.00 0.00 0.00 0.00 0.00 0.01 0.01

Consistency/quality check 1 1 1 1 1 5hort Term Debt/Equity Ratio 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Consistency/quality check 1 1 1 1 1 5CF to Total Debt 298.00% 25465.62% 213513.31% 79759.0% #######

Consistency/quality check 1 1 1 1 1 5

nancial Risk Factor: 20 pts out of 20 Excellent 10% Factor 20 0.0%

etermine Earnings Predictab 2009 2010 2011 2012 2013 TTM AVERAGE STDEVross Margin 51.65% 56.30% 59.21% 56.80% 52.87% 52.92% 55.0% 2.9%

Consistency/quality check 1 1 0 0 1 3et Margin 4.99% 12.59% 25.03% 18.13% 9.68% 8.54% 13.2% 7.3%

Consistency/quality check 1 1 0 0 0 2arnings $0.23 $0.54 $1.34 $0.99 $0.54 $0.48 0.69 0.40

Consistency/quality check 1 1 0 0 0 2ash from Ops $680.69 $811.51 $1,193.55 $771.25 $729.04 $614.22 $800.04 204.76

Consistency/quality check 1 1 0 0 0 2arnings Predict. Factor: 9 pts out of 20 Below Average -2% Factor 9 0.0%

atsenelson Absolute PE Valuation Modelarnings Growth 25.00% 26.61vidend Yield 1.84% 1.50

=djusted Base PE 28.11

xusiness Risk Average [1 + (1 - 1)]remium/Discount Factor: 1.00 xnancial Risk Excellent [1 + (1 - 0.9)]remium/Discount Factor: 0.90 xarnings Predictability Below Average [1 + (1 - 1.02)]remium/Discount Factor: 1.02 =djusted Fair Value PE 25% 30.30


P/E Exp EPS Grwth Rate Dividend Yield Add'l P/E Points

7.00 0% 0.0% 0.0

7.65 1% 0.1% 0.5

8.30 2% 0.5% 0.5

8.95 3% 1.0% 1.0

9.60 4% 1.5% 1.5

10.25 5% 2.0% 2.0

10.90 6% 2.5% 2.5

11.55 7% 3.0% 3.0

12.20 8% 3.5% 3.5

12.85 9% 4.0% 4.0

13.50 10% 4.5% 4.5

14.15 11% 5.0% 5.0

14.80 12% 5.5% 5.5

15.45 13% 6.0% 6.0

16.10 14% 6.5% 6.5

16.75 15% 10.0% 10.0

17.40 16%

17.90 17%

18.40 18%

18.90 19%

19.40 20%

19.90 21%

20.40 22%

20.90 23%

21.40 24%

21.90 25%

0.65

0.50


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Marvell Technology Group Ltd. Shares Out. Main. Capex Normalized Income Discount Rate R&D Years SG&A %

(MRVL)502.18 502.18 $78.99 $500.00 25%

8/16/2013 $500.00Figures in Millions except per share values

Current Price EPV Net Reproduction Value EPV MOS NCAV 52 Wk High 52 Wk Low

$13.04 $12.70 $10.37 0.0% $3.35 $13.51 $6.98

Asset Valuation Section EPV Valuation Section

Data: Asset Valuation EPV > Net Repro Value = Moat existsShares Outstanding 502.2 TTM Owner Earnings FCF 384.0$ EPV = Net Repro Value = No MoatBalance Sheet Assets 5,121.2$ Avg Normalized Income 842.2$ EPV < Net Repro Value = Value DestroyerAdjusted Assets 5,121.2$ Med Normalized Income 836.8$Total Liabilities 768.7$ Avg Adj. Income 5 yrs 802.5$Total Equity 4,352.4$ TTM Adjusted Income 642.8$

Average SGA % 8.7%

Marketing/Brand Value 275.5$ Data: EPVR&D Value 2,191.5$ Cost of Capital 9.0%

Cash Needed for Business 31.1$ Normalized Adjusted Income 500.0$Interest Bearing Debt -$ Average Maintenance Capex 79.0$Non Interest Bearing Debt 709.5$ Interest Bearing Debt -$Excess Cash 1,669.3$ 1% of sales 31.1$

Cash & Equiv 1,732.6$

Calculation: Asset Valuation Cash - Debt 1,701.6$Total Per Share Shares 502.18

Tangible BV 2,237.55$ 4.46$

Adjusted BV 4,352.44$ 8.67$ Calculation: EPVNCAV 1,684.19$ 3.35$ Cost of Capital Rates EPV Per Share + Cash - Debt Per ShareReprod. Cost of Assets 7,588.25$ 15.11$ 5% 8,420.2$ 16.77$ 10,121.8$ 20.16$Reprod. Cost of Assets BV 6,819.52$ 13.58$ 7% 6,014.4$ 11.98$ 7,716.0$ 15.37$Total Net Reprod. Cost 5,209.52$ 10.37$ 9% 4,677.9$ 9.32$ 6,379.5$ 12.70$

11% 3,827.4$ 7.62$ 5,529.0$ 11.01$13% 3,238.5$ 6.45$ 4,940.1$ 9.84$

Quarterly numbers based on: Q1Adjustments:

Assets Book Value Fixed BV MultiplierReproductionAsset Value

Cash & Equivalents 594.4$ 594.4$

Marketable Securities 1,138.2$ 1,138.2$

Adjustments:

Liabilities & Equity Book Value Fixed BV Multiplier ReproductionLiability Value

Accounts Receivable 370.4$ 370.4$ Accounts Payable 307.4$ 307.4$Other Receivable -$ -$ Accrued Expenses -$ -$Net Receivables 370.4$ 370.4$ Accrued Liabilities 246.4$ 246.4$

Inventories: Raw Materials -$ Notes Payable/Short Term Debt -$ -$

Inventories: Work in Progress 179.9$Current Port. of LT Debt/CapitalLeases -$ -$

Inventories: Purchased Components -$ Other Current Liabilities -$ -$

Inventories: Finished Goods 90.7$ Total Current Liabilities 553.8$ 553.8$Inventories: Other -$ Long-Term Debt -$ -$

Inventories -- Total 270.7$ 270.7$ Capital Lease Obligations -$ -$Prepaid Expenses 70.9$ 70.9$ Deferred Income Taxes -$ -$Current Defered Income Taxes 8.4$ 8.4$ Total Other Liabilities 155.6$ 155.6$

Other Current Assets -$ -$ Total Liabilities 768.7$ 768.7$Total Current Assets 2,452.9$ 2,452.9$ Common Stock Equity 4,352.4$ 4,352.4$Goodwill, Net 2,032.5$ 2,032.5$ Retained Earnings 1,559.7$ 1,559.7$Intangibles, Net 82.4$ 82.4$ Total Capitalization 4,352.4$ 4,352.4$

Intangibles 2,114.9$ 2,114.9$ Total Equity 4,352.4$ 4,352.4$Property/Plant/Equipment - Net 384.6$ 384.6$ Total Liabilities & Equity 5,121.2$ 5,121.2$

Other Long Term Assets, Total 168.7$ 168.7$Total Assets 5,121.2$ 5,121.2$

9% 3

Values for Normalized Income


$0

$2

$4

$6

$8

$10

$12

$14

Bo ok Valu e Ne t Rep ro Val ue EPV


11/12

Marvell Technology Group Ltd.

(MRVL)8/16/2013 Current Price NNWC NNWC % NCAV NCAV %

$13.04 $2.74 0.0% $3.35 0.0%

Figures in Millions except per share values BV

BV

Multiplier Net Net Value

Cash & Equivalents 594.42$ 100% 1,732.64$Marketable Securities 1,138.22$

Accounts Receivable 370.35$ 75%

Other Receivable -$Receivables 370.35$ 277.76$

Inventories: Raw Materials -$ 50%Inventories: Work in Progress 179.91$Inventories: Purchased Components -$Inventories: Finished Goods 90.75$Inventories: Other -$

Inventories -- Total 270.65$ 135.33$Current Assets - Total 2,452.91$ 2,452.91$Total Assets 5,121.17$ 5,121.17$Total Liabilities 768.73$ 768.73$Shares Outstanding 502.18 502.18

Total ($m) Per Share

Total Current Assets 2,452.91$ 4.88$Market Cap & Share Price 6.415B 13.04$

Book Value 4,352.44$ 8.67$Net Net Working Capital 1,377.01$ 2.74$

Discount to NNWC 0%

Net Current Asset Value 1,684.19$ 3.35$Discount to NCAV 0%

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