1 Can't-Miss Artificial Intelligence (AI) Stock to Buy With $100 Right Now

The major U.S. hyperscalers are set to spend over $700 billion on capital expenditures in 2026. The majority of that spending will go toward outfitting data centers with server racks full of GPUs, CPUs, and networking equipment to connect it all together. That means a handful of chipmakers are set to see strong demand for their products.

The market has bid up the prices of many semiconductor stocks, but one company still looks like an absolute bargain despite its excellent outlook over the next couple of years. And investors can buy stock with just $100 right now. Here’s why you should take a closer look at Marvell Technology (MRVL 2.42%).

Image source: Getty Images.

Putting fears to rest

Marvell is a leading chipmaker, specializing in networking chips. Fast networking equipment is essential for getting the most out of expensive GPUs in AI data centers. Marvell also has a burgeoning business designing custom AI accelerators, or XPUs, which can be more cost-effective resources for AI training and inference. Marvell is the company behind Microsoft’s Maia chips and Amazon’s Trainium and Inferentia chips.

However, the company saw its share price decline over the past few months amid investor concerns about the future of its XPU business. Reports surfaced last year that Microsoft is working with another chipmaker on its Maia 300 chips, and Amazon reportedly went with AIchip’s design for its next-generation Trainium chip rather than Marvell. That led many to expect the company’s top-line growth to slow.

Management put those fears to rest with its fourth-quarter earnings report. It expects revenue related to its custom silicon business to double year over year in fiscal 2027. That stems from continued growth with existing customers, management said, as well as growth in custom companion chips for those AI accelerators providing networking, memory expansion, and storage security.

Expand

NASDAQ: MRVL

Marvell Technology

Today’s Change

(-2.42%) $-2.20

Current Price

$88.59

Key Data Points

Market Cap

$79B

Day’s Range

$88.37 - $92.01

52wk Range

$47.09 - $102.77

Volume

165K

Avg Vol

16M

Gross Margin

50.10%

Dividend Yield

0.26%

Importantly, management suggested its contract with its top XPU customer remains strong. CEO Matt Murphy said:

We have purchase orders covering the entirety of this fiscal year for this next-generation program. In addition, we are expecting growth to continue in fiscal 2028 from this program. We are also deeply engaged on the follow-on generation of this XPU.

So, the long-term outlook for the segment remains positive, anchored by its largest customer, which is believed to be Amazon.

While the custom business gets a lot of attention considering how quickly it’s growing, Marvell’s networking chip business is also seeing booming demand from hyperscalers’ data center buildouts. Indeed, Marvell’s best-in-class chips are seeing growing demand as AI training and inference require low-latency networking equipment. Marvell’s chips are best suited for the task.

Overall, management provided guidance for this year’s revenue of $11 billion, up 34% from last year. That’s driven by strong growth in its data center segment, particularly in its interconnect chips. Management’s fiscal 2028 guidance for $15 billion in revenue suggests year-over-year acceleration. It also said non-GAAP (generally accepted accounting principles) EPS would exceed $5 that year.

With shares trading for about $90 as of this writing, investors can buy the stock for just 24 times analysts’ earnings expectations for this year. That’s an excellent price to pay for a company set to grow its top line at a mid-30% compound annual growth rate over the next few years and its bottom line even faster.