Marvell Joins the S&P 500 After a 210% Rally — But Can a Stock Trading at 99x Earnings Justify Even More Upside?

Shares of MRVL.BA surged 13% to $22.50 on Monday after its U.S.-listed parent, Marvell Technology, was confirmed for inclusion in the S&P 500 effective June 22. The U.S. stock is up 210% year-to-date , and the index nod caps a week that included Nvidia CEO Jensen Huang hailing Marvell as the next trillion-dollar firm . For CEDEAR holders in Buenos Aires, the question is whether forced index buying can sustain a stock already priced for near-perfection.

• Index Funds Must Now Buy — And That Creates a Short-Term Tailwind. When a stock enters the S&P 500, every passive fund that tracks the index must buy shares to match the new composition, creating demand that typically pushes the price higher.

Marvell has a market cap of roughly $230 billion , meaning billions of dollars in automatic purchases will flow in around the June 22 effective date. That mechanical buying is real — but temporary. Once index rebalancing is complete, the stock has to stand on its fundamentals alone.

• AI Chip Demand Is Real, But the Valuation Already Reflects It. Marvell reported record Q1 revenue of $2.418 billion, up 28% year over year, with non-GAAP earnings per share of $0.80.

Management guided Q2 revenue to $2.7 billion, implying 35% growth, and raised its full-year outlook. The numbers are strong. But the trailing P/E ratio stands at 99x, significantly higher than its five-year median of about 31x — meaning the stock is priced as if years of explosive growth are already guaranteed.

• Nvidia's Blessing Is a Double-Edged Sword. Nvidia invested $2 billion into Marvell , and Huang's public endorsement sent shares soaring 32% in a single session. That partnership deepens Marvell's position building custom chips and high-speed networking for cloud giants like Amazon and Microsoft. But concerns about customer concentration and market volatility persist . Heavy reliance on a handful of hyperscale buyers means any pullback in AI spending could hit Marvell hard.

• Insiders Are Selling Into the Euphoria. Insider activity has shown significant selling, with $32 million worth of shares sold in the past three months. That doesn't guarantee trouble, but it signals that executives closest to the business see current prices as a reasonable place to cash in — even as Wall Street targets push as high as $321. For CEDEAR investors, the Argentine-listed shares amplify both the upside and the currency and liquidity risk layered on top of an already volatile name.