Monolithic Power Systems (NASDAQ:MPWR) Stock Rating Upgraded by Rosenblatt Securities

Key Points

• Rosenblatt Securities upgraded Monolithic Power Systems to “buy” from “neutral” and set a $1,700 price target, implying 41.81% upside from the prior close. Analysts overall hold a “Moderate Buy” consensus, with an average target of $1,701.57.
• Monolithic Power Systems reported stronger-than-expected quarterly results, with EPS of $8.19 versus the $7.79 consensus and revenue of $1.20 billion versus $1.16 billion. Revenue rose 63.1% year over year, while net margin reached 24.41%.
• Valuation and governance risks remain: the stock trades at a 73.50 P/E ratio, opened below its 50- and 200-day moving averages, and faces uncertainty following a law-firm investigation announcement and recent insider selling.

Monolithic Power Systems (NASDAQ:MPWR - Get Free Report) was upgraded by investment analysts at Rosenblatt Securities from a "neutral" rating to a "buy" rating in a report released on Friday, MarketBeat Ratings reports. The firm presently has a $1,700.00 price objective on the semiconductor company's stock. Rosenblatt Securities's price objective indicates a potential upside of 41.81% from the company's previous close.

Several other equities analysts have also recently issued reports on the stock. TD Cowen decreased their target price on shares of Monolithic Power Systems from $1,850.00 to $1,700.00 and set a "buy" rating for the company in a research note on Monday, October 19th. Needham & Company LLC raised their price target on shares of Monolithic Power Systems from $1,750.00 to $2,000.00 and gave the company a "buy" rating in a research report on Friday, July 31st. Wall Street Zen raised shares of Monolithic Power Systems from a "hold" rating to a "buy" rating in a report on Sunday, October 25th. Raymond James Financial reiterated an "outperform" rating on shares of Monolithic Power Systems in a research report on Wednesday, August 12th. Finally, Arete Research assumed coverage on shares of Monolithic Power Systems in a research note on Thursday, August 20th. They set a "buy" rating and a $2,013.00 target price on the stock. Fourteen investment analysts have rated the stock with a Buy rating and two have given a Hold rating to the company's stock. Based on data from MarketBeat.com, Monolithic Power Systems has a consensus rating of "Moderate Buy" and an average target price of $1,701.57.

Monolithic Power Systems Stock Down 1.0%

Monolithic Power Systems stock opened at $1,198.81 on Friday. The business's 50-day moving average price is $1,276.68 and its 200 day moving average price is $1,309.09. The firm has a market cap of $58.91 billion, a price-to-earnings ratio of 73.50 and a beta of 1.68. Monolithic Power Systems has a 52 week low of $833.18 and a 52 week high of $1,714.09.

Monolithic Power Systems (NASDAQ:MPWR - Get Free Report) last announced its quarterly earnings results on Thursday, October 29th. The semiconductor company reported $8.19 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $7.79 by $0.40. Monolithic Power Systems had a return on equity of 22.31% and a net margin of 24.41%. The company had revenue of $1.20 billion during the quarter, compared to the consensus estimate of $1.16 billion. During the same period in the previous year, the company posted $4.73 earnings per share. Monolithic Power Systems's revenue for the quarter was up 63.1% on a year-over-year basis. Equities analysts expect that Monolithic Power Systems will post 23.95 EPS for the current year.

Insider Buying and Selling at Monolithic Power Systems

In other Monolithic Power Systems news, EVP Maurice Sciammas sold 30 shares of the company's stock in a transaction on Monday, August 3rd. The shares were sold at an average price of $1,343.94, for a total transaction of $40,318.20. Following the completion of the transaction, the executive vice president directly owned 1,119 shares in the company, valued at approximately $1,503,868.86. This represents a 2.61% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Kuo Wei Chang sold 50 shares of the firm's stock in a transaction dated Monday, August 24th. The shares were sold at an average price of $1,281.57, for a total transaction of $64,078.50. Following the completion of the transaction, the director directly owned 515 shares in the company, valued at $660,008.55. This represents a 8.85% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last three months, insiders sold 130 shares of company stock valued at $175,397. 3.60% of the stock is owned by insiders.

Institutional Investors Weigh In On Monolithic Power Systems

Hedge funds have recently modified their holdings of the business. BlackRock Inc. purchased a new stake in shares of Monolithic Power Systems in the 2nd quarter valued at approximately $7,727,289,000. State Street Corp raised its position in shares of Monolithic Power Systems by 4.3% during the 2nd quarter. State Street Corp now owns 2,282,186 shares of the semiconductor company's stock valued at $3,159,219,000 after buying an additional 93,732 shares during the period. Van ECK Associates Corp lifted its holdings in Monolithic Power Systems by 42.3% in the second quarter. Van ECK Associates Corp now owns 746,237 shares of the semiconductor company's stock valued at $1,031,568,000 after acquiring an additional 221,666 shares during the last quarter. Bank of America Corp DE acquired a new position in Monolithic Power Systems in the second quarter valued at approximately $741,271,000. Finally, Royal Bank of Canada grew its position in Monolithic Power Systems by 168.1% in the first quarter. Royal Bank of Canada now owns 473,368 shares of the semiconductor company's stock worth $517,557,000 after acquiring an additional 296,788 shares during the period. 93.46% of the stock is currently owned by institutional investors and hedge funds.

Key Monolithic Power Systems News

Here are the key news stories impacting Monolithic Power Systems this week:

• Positive Sentiment: Third-quarter results exceeded expectations. Non-GAAP earnings were $8.19 per share versus the $7.79 consensus estimate, while revenue reached $1.20 billion compared with expectations of $1.16 billion. Revenue increased 63.1% from the prior year, and EPS rose from $4.73. Monolithic Power Systems earnings report
• Positive Sentiment: Operating trends appeared healthy. Coverage highlighted improving inventory levels, while the company’s net margin was 24.41%. The results reinforce demand for MPS’s power-management semiconductors, particularly given the company’s substantial year-over-year growth. Monolithic Power Systems Q3 inventory report
• Neutral Sentiment: Finance leadership changed immediately. Monolithic Power appointed Tony Balow as vice president and chief financial officer and Robert Dean as vice president and chief accounting officer, effective immediately. The appointments could provide continuity, but investors may seek more detail about the transition and its implications. MPS CFO and CAO appointments
• Negative Sentiment: Investor uncertainty increased after a law-firm investigation was announced. Rosen Law Firm said it was investigating potential breaches of fiduciary duties by MPWR’s directors and officers. The announcement does not establish wrongdoing, but it creates a governance overhang that may weigh on sentiment. Rosen Law Firm investigation announcement
• Negative Sentiment: Valuation leaves little room for disappointment. MPWR’s reported P/E ratio of 73.50 is elevated, and shares opened below both their 50-day and 200-day moving averages. Thus, despite the earnings beat, investors may be taking profits or demanding stronger forward commentary before bidding the stock higher.

Monolithic Power Systems Company Profile

Monolithic Power Systems, Inc NASDAQ: MPWR is a semiconductor company that designs, develops and markets high-performance power-management solutions. Its products help regulate, convert, distribute and control electrical power in electronic systems, supporting applications that require efficient and reliable power delivery.

The company's portfolio includes integrated circuits, power modules, battery-management products, motor drivers, LED drivers and related analog and mixed-signal semiconductor solutions.

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