Stock Analysis | Monolithic Power Outlook - A Bearish Signal Amid Mixed Analyst Views

Market Snapshot

Headline Takeaway: Monolithic Power (MPWR) is in a weak technical position with a score of 1.72 from internal diagnostics, signaling caution for investors.

News Highlights

Recent news points to shifting dynamics in the semiconductor sector. A $750M net outflow in the US Semiconductors ETF (SOXX) highlights broader market concerns, while McKinsey's report on US tariffs could influence long-term industry strategies. Additionally, Japan's proposed cooperation with the US in rare earths and semiconductors suggests potential trade policy shifts that could indirectly affect MPWR's supply chain and operations.

Analyst Views & Fundamentals

Analysts are divided on Monolithic Power, with a simple average rating of 4.10 and a performance-weighted rating of 3.71. While the ratings are relatively neutral, the dispersion in views—ranging from Strong Buy to Underperform—suggests uncertainty about the stock's direction. The stock has seen a 2.59% price rise recently, aligning with the market’s relatively neutral weighted expectations.

Key fundamental factors show mixed signals. Notable values include:

• Net profit attributable to parent company shareholders / Net profit: 100.0% (internal diagnostic score: 2.04)
• EV/EBIT: 83.14 (internal diagnostic score: 4.09)
• GPM: 55.08% (internal diagnostic score: 1.84)
• Cash-UP: -9.61% (internal diagnostic score: 2.76)
• Total profit YoY growth rate: 53.17% (internal diagnostic score: 4.61)
• Accounts receivable turnover ratio: 7.09 (internal diagnostic score: 2.25)

These figures suggest some positive momentum in earnings and operating efficiency, though the weak cash flow from operations and low gross profit margin raise caution.

Money-Flow Trends

Fund flows into Monolithic Power have been encouraging in recent periods. The overall inflow ratio is 53.98%, with positive trends across all investor categories. Notably:

• Small investors (50.32%) and Extra-large investors (55.13%) are showing the strongest inflows.
• Large and medium-sized investors also show inflow ratios above 50%.

This suggests broad-based institutional and retail interest, although it remains to be seen whether this activity will translate into sustained price momentum.

Key Technical Signals

Monolithic Power's technical indicators are leaning heavily bearish. Over the last five days, key signals include:

• Marubozu White (2025-08-26) with an internal diagnostic score of 1.0.
• MACD Death Cross (2025-08-21 and 2025-08-28) with an internal diagnostic score of 1.0.
• Piercing Pattern (2025-08-18) with an internal diagnostic score of 1.0.

These patterns indicate weakening momentum and rising sell pressure. The technical score of 1.72 aligns with the weak trend identified in the summary, reinforcing the cautionary stance.

Conclusion

Monolithic Power currently shows signs of a bearish trend, with five bearish signals and zero bullish indicators in the last five days. While the company's fundamentals show some positive signs in profit growth and operating efficiency, the weak technical indicators and internal diagnostic score of 1.72 suggest a high-risk environment. Investors are advised to consider waiting for a pull-back or further clarity before committing capital to MPWR. As always, keep an eye on upcoming industry developments and analyst revisions for potential turning points.