Company Update (NASDAQ:CAVM): Cavium Inc Announces New Low Power 16-core OCTEON® III SoC Processors

Cavium Inc (NASDAQ:CAVM), a leading provider of semiconductor products that enable intelligent processing for enterprise, data center, cloud, wired and wireless networking, announced the addition of two new pin-compatible families CN73XX and CN72XX to its leading OCTEON® III MIPS64® multi-core processor line, providing a powerful solution for mid-range performance points spanning 4 to 16 cores. These new low-power processor families deliver industry-leading compute and packet performance for devices in this class, along with powerful networking, virtualization and multi-layer security acceleration, while meeting the stringent power requirements of compact and resilient networking and security appliances, storage appliances, wireless infrastructure, switches, and integrated routers. These two product families fill out the mid-range of the OCTEON III family between the 1 to 4-core CN70/71XX and 24 to 48-core CN78XX.

Global mobile data traffic will increase nearly 11-fold between 2013 and 2018 (61% CAGR), while cloud data center IP traffic will more than double between 2014 and 2017 (30% CAGR) according to Cisco’sVisual Networking Index and Global Cloud Index. As a result, the demands on network scalability, programmability, performance and manageability have dramatically increased. Mainstream Enterprise Networking applications are being challenged to deliver multi-fold increases in throughput per dollar while enabling new protocols and powerful virtualization features across the compute and storage networks.

The emerging applications in Software Defined Networking (SDN) and Network Function Virtualization (NFV) are driving networks to become application centric, with intelligence to dynamically launch applications and provide on-demand consumption of connectivity and bandwidth without impacting the reliability and SLA requirements of enterprises and service providers. Software-only solutions do not deliver the performance, low-latency, and determinism needed to meet these goals. A new class of hardware accelerated solutions is required to deliver high control and data plane performance with integrated L3-L7 security, including firewall, Deep Packet Inspection, Intrusion Prevention and Application recognition.

Cavium’s new OCTEON III CN73XX and CN72XX family SoCs pack up to 16 cores that deliver up to 35GHz of compute, 40Gbps of application performance and 120Gbps of networking connectivity in a low-power envelope and compact footprint to address these requirements, providing an ideal solution for fully integrated control, data plane, and services processing on a single SoC. A 4th generation powerful and flexible new packet parsing capabilities are integrated that can process both existing and emerging protocols such as MPLS, NVGRE, and VxLAN at line rate, along with sophisticated traffic management capabilities that provide the fine grained traffic shaping and QoS required for application-centric networks.

The integrated hardware accelerated security processing capabilities are turbo charged with support for a range of new crypto algorithms including the latest SHA3 and enable 40Gbps IPSec using a single chip, to efficiently secure high-throughput enterprise, datacenter, and wireless backhaul connections. Cavium’slatest Deep Packet Inspection (DPI) is able to scan millions of flows and patterns in real-time to enable enterprises and service providers to provide robust protection against security threats while delivering intelligent application-based services.

Cavium provides a rich set of software tools, libraries and application software including a comprehensive carrier grade SDK, and optimized software toolkits including TCP/SSL/IPsec.  The entire OCTEON line of products is supported by Cavium’s broad PACE ecosystem enabling a range of software, hardware, and ODM solutions to speed time-to-market. (Original Source)

Shares of Cavium closed yesterday at $73.86 . CAVM has a 1-year high of $75.93 and a 1-year low of $38.73. The stock’s 50-day moving average is $68.33 and its 200-day moving average is $65.26.

On the ratings front, Cavium has been the subject of a number of recent research reports. In a report released yesterday, Stifel Nicolaus analyst Kevin Cassidy maintained a Buy rating on CAVM, with a price target of $81, which represents a potential upside of 9.7% from where the stock is currently trading. Separately, on the same day, Oppenheimer’s Rick Schafer reiterated a Buy rating on the stock and has a price target of $72.

According to, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Kevin Cassidy and Rick Schafer have a total average return of 37.5% and 27.8% respectively. Cassidy has a success rate of 78.4% and is ranked #6 out of 3619 analysts, while Schafer has a success rate of 79.1% and is ranked #11.

In total, one research analyst has assigned a Hold rating and 5 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $75.20 which is 1.8% above where the stock closed yesterday.

Cavium Inc designs, develops and markets semiconductor processors that enable intelligent processing for wired and wireless networking, communications, storage, cloud, wireless, security, video and connected home and office applications.

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