How are energy investors positioned?
On Monday, KeyBanc Capital Markets provided insights on NVIDIA (NASDAQ:NVDA) and Monolithic Power Systems (NASDAQ:MPWR) in anticipation of the upcoming GPU Technology Conference (GTC). NVIDIA’s CEO, Jensen Huang, is scheduled to launch GTC on Tuesday, March 18, at 10 AM PT. According to InvestingPro data, MPWR, currently valued at $29 billion, has demonstrated strong momentum with 21.2% revenue growth over the last twelve months. The event is expected to unveil several new developments, including the Blackwell Ultra (B300/GB300) set to enter mass production in the second half of 2025, a preview of the next-gen GPU architecture Rubin slated for 2026, the introduction of Co-packaged Optics (CPO) switches, and discussions on Robotics.
Later in the week, on Thursday, March 20, Monolithic Power Systems will host its analyst event. Given the proximity in timing and location to GTC in San Jose, there is speculation that MPWR may announce the recovery of market share at NVIDIA with the Blackwell Ultra. The company enters this event with strong fundamentals, maintaining an excellent financial health score and receiving upward earnings revisions from 15 analysts, as reported by InvestingPro. MPWR is one of only two suppliers qualified on this platform, and while it is not confirmed if they are back in, KeyBanc suggests a strong possibility of regaining share.
If MPWR does not confirm its involvement with Blackwell Ultra, KeyBanc anticipates the company will instead emphasize its core non-AI businesses. These sectors have historically grown 15-20% faster than the industry average. Despite the stock’s 29.88% decline over the past six months, MPWR maintains robust financials with a current ratio of 5.31, indicating strong liquidity. Additionally, KeyBanc noted that MPWR’s updated outlook for Enterprise Data being flat in 2025 has already mitigated potential risks to NVIDIA’s expectations. For deeper insights into MPWR’s valuation and growth prospects, investors can access the comprehensive Pro Research Report available on InvestingPro.
The introduction of NVIDIA’s CPO switches is seen as a negative development for Marvell Technology Group (NASDAQ:MRVL), but this impact is believed to have been largely expected by the market. The GTC and MPWR’s analyst event are both seen as significant industry events that could influence the market positions of the companies involved.
In other recent news, Monolithic Power Systems reported strong financial results for the fourth quarter of 2024, exceeding Wall Street expectations. The company achieved an earnings per share (EPS) of $4.09, surpassing the forecasted $3.98, and generated revenue of $621.7 million, which was higher than the anticipated $608.1 million. Following these results, several firms adjusted their price targets for Monolithic Power Systems. Truist Securities raised its target to $897, citing the company’s modest outperformance and positive first-quarter forecast. KeyBanc increased its target to $850, highlighting the robust performance of the automotive division. Citi also raised its target to $800, maintaining a Buy rating due to the company’s diversified growth and consistent outperformance. Needham set a new price target of $800, emphasizing the company’s resilience in overcoming challenges in the Enterprise Data segment. These developments reflect a strong confidence in Monolithic Power Systems’ strategic execution and growth potential across various sectors.
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