Marvell Technology (NASDAQ:MRVL) is scheduled to report its earnings on Thursday, May 29, 2025. For event-driven traders, understanding the company’s historical performance around earnings announcements can be crucial. In recent years, Marvell Technology has a notable trend of negative one-day returns following earnings announcements. Specifically, this has occurred in 62% of instances, with a median decline of -5.9% and a maximum one-day drop of -19.8%. As an aside, see What Sparked UNH Stock Crash?
Given these historical patterns, traders might consider two main approaches:
- Pre-earnings positioning: Based on the historical odds, some traders may choose to adjust their positions prior to the earnings release.
- Post-earnings positioning: Alternatively, traders could analyze the correlation between immediate and medium-term returns after the earnings are released to inform their post-announcement strategies.
Current consensus estimates project Marvell Technology to report earnings of $0.61 per share on sales of $1.88 billion. These figures represent a significant improvement compared to the year-ago quarter, when the company reported earnings of $0.24 per share on sales of $1.16 billion.
From a fundamental perspective, Marvell Technology currently has a market capitalization of $55 billion. Over the last twelve months, the company generated $5.8 billion in revenue. However, it was operationally loss-making, reporting -$366 million in operating losses and a net income of -$885 million.
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MRVL Stock Historical Odds Of Positive Post-Earnings Return
Some observations on one-day (1D) post-earnings returns:
- There are 16 earnings data points recorded over the last five years, with 6 positive and 10 negative one-day (1D) returns observed. In summary, positive 1D returns were seen about 38% of the time.
- However, this percentage decreases to 27% if we consider data for the last 3 years instead of 5.
- Median of the 6 positive returns = 13%, and median of the 10 negative returns = -5.9%
Additional data for observed 5-Day (5D), and 21-Day (21D) returns post earnings are summarized along with the statistics in the table below.
MRVL Stock Correlation Between 1D, 5D, and 21D Historical Returns
A relatively less risky strategy (though not useful if the correlation is low) is to understand the correlation between short-term and medium-term returns post earnings, find a pair that has the highest correlation, and execute the appropriate trade. For example, if 1D and 5D show the highest correlation, a trader can position themselves “long” for the next 5 days if 1D post-earnings return is positive. Here is some correlation data based on 5-year and 3-year (more recent) history. Note that the correlation 1D_5D refers to the correlation between 1D post-earnings returns and subsequent 5D returns.
Is There Any Correlation of MRVL Stock With Peer Earnings?
Sometimes, peer performance can have influence on post-earnings stock reaction. In fact, the pricing-in might begin before the earnings are announced. Here is some historical data on the past post-earnings performance of Marvell Technology stock compared with the stock performance of peers that reported earnings just before Marvell Technology. For fair comparison, peer stock returns also represent post-earnings one-day (1D) returns.
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