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Skip NavigationMarketsBusinessInvestingTechPolitics & PolicyVideoWatchlistInvesting ClubPROLivestreamMenuMarvell Technology is likely to trade lower following its move to acquire photonics firm Lumentum Holdings , Bank of America said. The bank downgraded the semiconductor solutions stock to neutral from buy and lowered its price target to $225 from $400, which still implies 31% upside from Monday’s close. “We downgrade MRVL to Neutral from Buy, maintain our estimates, but lower PO to $225 from $400 on potential for extended stock overhang from announced all-stock LITE deal,” analyst Vivek Arya said Monday in a note to clients. “Our concern centers around: 1) Extended regulatory process … including in China, 2) Limited [earnings per share] accretion as $1bn in cost cuts insufficient to offset the ~50% dilution in share-count, 3) Potential customer/channel conflict.” Shares of Marvell closed down 13% on Monday after the firm said that it would acquire Lumentum in a more than $100 billion deal. Its stock has fallen nearly 12% over the past three months. MRVL 3M mountain Shares have fallen nearly 12% over the past three months. Marvell said the acquisition is aimed at becoming a “category leader in AI connectivity.” The pending deal isn’t the only risk for Marvell, according to Bank of America. The stock could also lose ground due to a “recent contraction in sector multiples,” Arya said. Over the past month, the Philadelphia Semiconductor Index has fallen about 19%. Bank of America’s call goes against consensus on Wall Street. Of the 45 analysts covering Marvell, 40 have a buy or strong buy rating on the stock, while five have a hold, LSEG data shows.Read More