Brian.oco 0 Posting Whiz

Investors were banking on a lousy jobs number, and the last two days of trading have reflected that point That’s what I’m hearing from the traders I know – shrewd peope I shared trading pits with back in the day – almost to a man (and woman) saying that next to the housing market, the next most important key in rebounding from a deep recession is jobs.

So when the day before the U.S. Labor department is expected to announce new U.S. employment numbers, the market falls in the last hour of trading over 200 points alone. Hmmm. I’m betting that Wall Street isn’t bullish on what we’re all going to hear tomorrow, but maybe it will finally signal a bottom to the recession.

One company that seems to be holding up pretty well under a harsh economic spotlight is Marvel. No, not the comic-book provider, but the Barbados-based semiconductor developer. True, Marvel (MRVL) fell 0.44% yesterday, after rising 20% in Wednesday’s trading to $6.13 per share.

But investors who study the Marvel management style say that the company has figured out, more or less, how to control costs in a recession – no mean feat. On Wednesday, the world got a peak into Marvel’s management style, as the company announced third-quarter earnings that bested Wall Street expectations.

The company earned $70.9 million, or 11 cents per share, compared with a loss of -$6.4 million, or -1 cent a share, a year earlier. Excluding one-time items, adjusted earnings-per-share was 23 cents, two cents ahead of the consensus. Revenue rose 4% to $791 million. Altogether, the financial web site Tickerspy reports that 16 of its experts counted Marvel among their top-15 holdings at the end of Q3.

What’s all the hub-bub? For starters, Marvel has acted very much like the ant, as opposed to the grasshopper, and stored away plenty of cash for the harsh winter ahead. Marvel has about $900 million in cash on hand – and that’s enough to pay off all of its long-term debt – today.

Company CEO Sehat Sudartja is also seen as something of a visionary by investors; a guy who sees opportunity where a lot of competitors do not. Sudartja sees lots of chip sales in the notebook market, especially as they become even more portable. Same thing with smart phones – as they get even smarter, Marvel is pouring millions into the research that phones will need a few years from now. Remember that old line from hockey great Wayne Gretzky? Where he said, “I don’t go to where the puck is; I go to where it’s going to be.”

Well, that’s Marvel, when it comes to mobile convergence.

Says the Motley Fool this week; “The Apple iPhone and Android platform are early examples of Web-browsing phenoms that come close to replacing traditional computers for many users. If these gadgets get just a little bit better, and the price creeps below the magic $200 mark, consumer demand should explode. Management sees that happening next year. "We believe consumers within emerging markets will drive significant volumes far in excess of the current notebook PC market and likely a greater volume than smart phone markets," the CEO said.”

“It's important to note that Marvell makes essentially every component you'd need for building such a converged mobile computer, including wireless controllers, ultra-mobile CPUs, and GPS products. So if the market goes the way Mr. Suthardia thinks it will, Marvell stands to profit handsomely from that tectonic shift.”

What Marvel is selling is a cheap chip device that will for notebooks and smart phones what regular semiconductors are doing for regular computers today. That I like.

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