Monolithic Power Outlook - Mixed Signals as Technicals Deter, Fundamentals Brighten

Market Snapshot

Takeaway: Monolithic Power (MPWR) is showing diverging signals: while the technical landscape is weak and suggests caution, fundamentals and recent money flows remain positive, offering a nuanced picture.

News Highlights

1. McKinsey on Tariffs and Semiconductors

New McKinsey research highlights how U.S. tariffs could impact the semiconductor sector. The study comes amid shifting legal rulings and trade policies that may reshape the supply chain landscape. Though not MPWR-specific, it reflects broader sector uncertainty.

2. Green Semiconductor Innovation

Semiconductor design firm Cadence announced advancements in green tech for semiconductors, a trend that could benefit MPWR as the industry pivots toward sustainable solutions. The move aligns with growing demand for energy-efficient chips in AI and data centers.

3. Semiconductors ETF SOXX Sees $750M Outflow

The US Semiconductors ETF (SOXX) faced a significant net outflow of $750 million in May 2025. While MPWR wasn’t directly mentioned, the broader sector pressure could influence investor sentiment toward semiconductor stocks like MPWR.

Analyst Views & Fundamentals

Analysts are cautiously optimistic. The simple average rating stands at 4.10, while the performance-weighted rating is slightly lower at 3.71. These scores suggest a generally positive outlook, though with some dispersion in views.

Rating Consistency: Analysts are not in full agreement. Ratings range from "Strong Buy" to "Neutral", with four "Strong Buy" and three "Buy" recommendations within the last 20 days. This dispersion reflects a sector in transition and a stock like MPWR with both strong fundamentals and technical challenges.

Price Trend vs. Ratings: The stock has risen by 3.56% recently, matching the positive expectations implied by the average rating. However, technical indicators suggest this trend may be fragile.

Fundamental Factors & Scores:

• Net profit attributable to parent company shareholders / Net profit: 100.0% (Internal diagnostic score: 1.72)
• EV/EBIT: 83.14 (Internal diagnostic score: 3.56)
• Accounts receivable turnover ratio: 7.09 (Internal diagnostic score: 1.72)
• Total profit (YoY growth rate): 53.17% (Internal diagnostic score: 5.55)
• Net cash flow from operating activities (YoY growth rate): 26.99% (Internal diagnostic score: 3.17)
• Diluted earnings per share (YoY growth rate): 41.37% (Internal diagnostic score: 4.10)
• Net profit attributable to parent company shareholders (YoY growth rate): 38.68% (Internal diagnostic score: 4.74)
• Cash-MV: -0.84% (Internal diagnostic score: 3.67)

Money-Flow Trends

Big money continues to show interest in MPWR, with block inflow ratio at 52.45%, and an overall inflow ratio of 52.23%. This suggests that institutional investors are maintaining their positions or even increasing them, despite mixed technical signals.

Retail (Small) inflow ratio is at 50.01%, indicating moderate retail participation. While not overwhelming, the trend suggests that MPWR is still capturing some public attention.

Extra-large inflow ratio is the highest at 53.06%, reinforcing the idea that heavy hitters are still buying in. This could stabilize the stock even if technical indicators suggest a bearish trend.

Key Technical Signals

Technically, MPWR is a stock to watch with caution. The internal technical score is 3.52 out of 10, with 3 bearish indicators outweighing just 1 bullish. The key insights suggest volatility and weak trend clarity, reinforcing the "avoid" recommendation.

Recent Indicators by Date:

• 2025-09-11: Dividend Announcement Date (Internal diagnostic score: 7.8)
• 2025-09-05: WR Overbought (Internal diagnostic score: 1.72)
• 2025-09-08: WR Overbought (Internal diagnostic score: 1.72)
• 2025-08-28: MACD Death Cross (Internal diagnostic score: 1.0)
• 2025-08-27: MACD Golden Cross and WR Overbought (Internal diagnostic scores: 3.56 and 1.72 respectively)

These signals suggest recent mixed momentum. The MACD Death Cross is a bearish indicator with a weak internal score, while the Dividend Announcement was one of the few positive signals recently. Investors should monitor whether these signals evolve into a clearer trend or continue to cancel each other out.

Conclusion

Monolithic Power is at a crossroads: fundamentals are strong with positive earnings and cash flow growth, while technical signals and analyst ratings remain mixed. The key takeaway is to watch for a pull-back or a clearer technical breakout before entering long positions. With block and extra-large investors still active, MPWR may offer value, but timing is critical.