Monolithic Power Systems Inc. (NASDAQ:MPWR) is Waving the Bear Flag

Monolithic Power Systems Inc. (NASDAQ:MPWR) is Waving the Bear Flag


The Monolithic Power Systems Inc. (MPWR) shares are trading at lower $226.25 and the avg recommendation for the stock is Strong Buy. The current analyst price target stands at $209.11.

To add more color to this target, the company’s high over the last year is $238.94 and the low is $126.07. Over the last 52 weeks, MPWR is down -5.31% while the S&P 500 is down -2.38%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, MPWR reported a profit of $91.45 million. Monolithic Power Systems Inc. also saw revenues increase to $165.78 million. In addition, MPWR has free cash flow of $41.47 million as of 03-2020 The company’s EBITDA came in at $39.56 million which compares well with its peers.

MPWR booked profit margins of 18.20%, its Return on Equity (ROE) is 15.70%, and its Return on Assets is 12.60%. All told, it is clear that, MPWR needs to be on your watchlist.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. MPWR has a short ratio of 2.83 and outstanding shares of 44.46M.

Company Outlook

MPWR has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 0.39 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at 2.61. Monolithic Power Systems Inc. MPWR also noted assets of $1.01 billion at the end of the last quarter. Investors should also keep an eye on sector updates as MPWR has historically followed its peers on positive news.

All told, Monolithic Power Systems Inc. MPWR has strung together solid data and demonstrated underlying fundamentals. At its current valuation, MPWR represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

Monolithic Power Systems Inc. MPWR is now commanding a market cap of 10.23B and a float of 43.50M. MPWR is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of MPWR stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in MPWR, either long or short, and we have not been compensated for this article.