Monolithic Power Outlook - Mixed Signals Amid Fundamentals and Technicals

Market Snapshot

Headline Takeaway: Monolithic Power (MPWR) appears to be facing a mixed market outlook with conflicting signals from technical indicators and a relatively strong fundamental score. The stock has fallen 0.19% recently, and market expectations are neutral.

News Highlights

• McKinsey Weighs In on Tariffs and Chip Supply Chains – New research from McKinsey & Co explores US tariffs policy and its likely impact on the semiconductors sector, indicating a potential shift in the sector's dynamics. This could affect MPWR's supply chain and market access.
• Japan Proposes Cooperation on Rare Earths and Semiconductors – The government is arranging to propose greater cooperation between Japan and the U.S. in rare earths and semiconductors, which could help counter China's dominance. This development might boost MPWR's long-term prospects in international markets.
• US Semiconductors ETF SOXX Faces $750M Net Outflow in May 2025 – The ETF's outflow highlights investor concerns over the sector's performance. This could indirectly impact MPWR's liquidity and investor sentiment.

Analyst Views & Fundamentals

Analysts have shown a mixed outlook for MPWR, with 9 institutions rating the stock over the past 20 days. The simple average rating is 4.10, while the performance-weighted rating is 3.71. However, these scores show moderate dispersion, with ratings ranging from Neutral to Strong Buy.

Key fundamental factor values (based on internal diagnostic scores) show:

• Net profit attributable to parent company shareholders / Net profit: 100.0% – Internal diagnostic score: 2.0 (weak)
• EV/EBIT: 83.14 – Internal diagnostic score: 3.36 (moderate)
• Basic earnings per share (YoY growth rate): 41.16% – Internal diagnostic score: 4.16 (positive)
• Net cash flow from operating activities per share (YoY growth rate): 29.13% – Internal diagnostic score: 3.42 (moderate)
• Accounts receivable turnover ratio: 7.09 – Internal diagnostic score: 2.11 (weak)

These fundamentals suggest a mixed picture, with strong earnings growth but weak cash flow and turnover ratios. The disconnect between the positive ratings and the weak price movement highlights a potential market correction or investor uncertainty.

Money-Flow Trends

Monolithic Power is showing positive money-flow trends, with an overall inflow ratio of 52.33% across all sizes of institutional investors. Notably:

• Extra-large investors are showing the strongest inflow, with a ratio of 53.32% and a positive trend.
• Large and medium investors are showing mixed signals, with inflow ratios of 48.70% and 49.51%, respectively, but negative trends.
• Small investors are showing a negative trend with an inflow ratio of 49.80%, suggesting retail investor caution.

Big money remains net positive, but retail sentiment is contrarian, indicating a possible short-term correction or sideways movement.

Key Technical Signals

Monolithic Power's technical indicators are predominantly bearish. The technical score is 3.56 (weak), and key insights from the analysis include:

• MACD Death Cross – Internal diagnostic score: 1.0, suggesting a bearish crossover.
• WR Overbought – Internal diagnostic score: 1.88, indicating the stock is overbought.
• MACD Golden Cross – Internal diagnostic score: 3.56, neutral but with historically low returns.
• Dividend Announcement Date – Internal diagnostic score: 7.8, a strong bullish signal.

Recent chart patterns include:

• 2025-09-11 – Dividend announcement triggered a bullish signal.
• 2025-08-28 – MACD Death Cross, a negative signal.
• 2025-09-05 – WR Overbought, a neutral signal.

Overall, the technical signals are conflicting and volatile, with three bearish and one bullish indicators. The lack of clear momentum suggests caution for short-term traders.

Conclusion

Monolithic Power faces a mixed outlook, with strong fundamentals clashing with weak technicals. While the fundamental score (5.59) is robust and supported by key metrics like 41.16% earnings growth, the technical score (3.56) and mixed analyst ratings suggest caution. Money flows remain positive for large institutional investors, but retail sentiment is cautious.

Actionable Takeaway: Consider monitoring the dividend impact on the stock's short-term momentum. For now, a wait-and-watch approach might be prudent, particularly for investors expecting a pullback before committing capital.