Marvell Raises Forecast; FBR Ups Price to $22

Wireless and disk drive chip maker Marvell Technology Group (MRVL) is hopping this morning, up 72 cents, or 5%, at $15.30 after the company raised current-quarter (fiscal Q3) forecast above estimates.

For the quarter, the company now sees revenue of $760 million to $775 million, above the $680 million to $730 million prior estimate, based on “broad improvement in demand within multiple end markets.”

That’s ahead of $710 million average estimate of analysts. Analyst Craig Berger with Friedman, Billings, Ramsey this morning notes that Marvell’s top customer, Western Digital, recently reported a blowout quarter. He notes that rising demand for PCs (and disk drives, therefore) and shipments for baseband chips for China’s TD-SCDMA standard could be catalysts in 2010. Berger raised his price target on the stock to $22 from $20 and maintains an “Outperform” rating on the stock, which he calls one of his “favorite picks.”

Berger notes the pre-announcement could also have positive implications for chip maker LSI Logic (LSI), which reports Wednesday.

The company said it will also have a one-time tax benefit of 5 cents per share in the quarter.