Wang & Lee Group board approves 250-to-1 reverse share split
On Thursday, Monolithic Power Systems (NASDAQ:MPWR), currently trading at $609.02 with a market capitalization of $29.15 billion, received a reiterated Buy rating and $800.00 price target from Citi. According to InvestingPro data, 15 analysts have recently revised their earnings estimates upward for the upcoming period, reflecting growing confidence in the company’s prospects. The company hosted its Analyst Day on Wednesday, where it announced a 2% increase in its first-quarter 2025 sales guidance and reaffirmed its revenue target for 2025-2027, aiming to outpace market growth by 10-15%. The anticipated growth is expected to come from non-AI markets such as Automotive, Industrial, and Communications, which together represent 38% of the company’s projected 2025 sales.
Despite the forecasted stagnation in Monolithic Power’s Enterprise Data business, which accounts for 27% of its anticipated 2025 sales, Citi believes the current valuation reflects the potential near-term pressure on the stock. The firm’s analysts maintain a positive outlook on Monolithic Power, citing the company’s consistent performance and diversified business model as key factors supporting their Buy rating. InvestingPro analysis shows the company maintains excellent financial health with a score of 3.28 (rated as "GREAT"), supported by strong metrics including a healthy current ratio of 5.31 and impressive revenue growth of 21.2% over the last twelve months.
Citi’s analysis suggests that the downside risks associated with the Enterprise Data segment are already factored into Monolithic Power’s stock price. The analysts express confidence in the company’s proven track record of consistent execution, which they believe could result in financial results that surpass current estimates.
Monolithic Power’s Analyst Day highlighted the company’s strategic focus on expanding its presence in markets beyond AI, leveraging its strengths in areas like Automotive, Industrial, and Communications. The firm’s commitment to exceeding market growth over the next few years reflects its ambition to continue as a leading player in the power solutions sector.
In summary, Citi’s reiteration of the Buy rating and price target for Monolithic Power stock underscores the firm’s belief in the company’s long-term potential as a diversified quality compounder, despite the short-term challenges faced by its Enterprise Data business. The company’s P/E ratio of 16.6 and remarkable dividend growth of 56% further support its investment case. For deeper insights into MPWR’s valuation and growth prospects, investors can access comprehensive analysis and 14 additional ProTips through InvestingPro’s detailed research reports.
In other recent news, Monolithic Power Systems has updated its financial guidance for the first quarter ending March 31, 2025, projecting revenue between $630 million and $640 million, an increase from the prior estimate of $610 million to $630 million. This revision suggests a stronger-than-expected performance, accompanied by projected GAAP operating expenses of $184.9 million to $190.9 million and non-GAAP operating expenses of $131.6 million to $135.6 million. Truist Securities has maintained its Buy rating on the company, raising the price target to $897, citing the company’s ability to deliver exceptional growth and margin expansion. Additionally, KeyBanc Capital Markets speculates that Monolithic Power Systems might regain market share at NVIDIA (NASDAQ:NVDA)’s Blackwell Ultra platform, although this remains unconfirmed. Investors are also looking forward to the company’s Analyst Day, where further insights into corporate strategy and product updates are expected. The financial community is particularly interested in the company’s ability to navigate the competitive semiconductor landscape and deliver on its raised expectations. Monolithic Power Systems’ recent developments and financial outlook have captured the attention of analysts and investors, highlighting its potential for continued growth.
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