Stock Analysis | Monolithic Power Outlook - A Weak Technical Profile and Mixed Analyst Sentiment

Market Snapshot

Headline Takeaway: Monolithic Power's technical signals remain bearish with a weak score of 2.17, advising investors to avoid the stock for now. Meanwhile, market fundamentals remain mixed, with average analyst ratings hovering near "Market Outperform."

News Highlights

• McKinsey on Tariffs and Semiconductors – New research from McKinsey highlights ongoing uncertainties in US tariffs policy and their potential impact on the semiconductor sector, which could affect MPWR’s exposure and supply chain dynamics.
• Japan-U.S. Semiconductor Cooperation – Japan announced proposals for expanded collaboration with the U.S. on rare earths and semiconductors. This could indirectly benefit MPWR if trade policies shift to favor global supply chain resilience.
• Investor Activity in the Sector – Lansforsakringar Fondforvaltning AB recently made a $11.77 million investment in NXP Semiconductors. This highlights investor appetite in the broader chip space, which MPWR is a part of, but not yet directly reflected in its own performance.

Analyst Views & Fundamentals

Average Rating Score (Simple Mean): 4.10

Weighted Rating Score (Performance-Weighted): 3.71

Rating Consistency: Analysts are not aligned, with ratings ranging from "Strong Buy" to "Underperform." The weighted score reflects caution, matching the weak technical signals.

Key Fundamental Metrics and Scores

• Net Cash Flow from Operating Activities per Share (YoY Growth Rate %): 29.13% – Internal diagnostic score: 2.00
• Total Profit (YoY Growth Rate %): 53.17% – Internal diagnostic score: 3.00
• Net Profit Attributable to Parent Company Shareholders (YoY Growth Rate %): 38.68% – Internal diagnostic score: 3.00
• GPM (Gross Profit Margin): 55.08% – Internal diagnostic score: 0.00
• CFOA (Cash Flow from Operations to Assets): 5.98% – Internal diagnostic score: 3.00
• GPOA (Gross Profit to Assets): 9.21% – Internal diagnostic score: 3.00
• Net Profit Attributable to Parent Company Shareholders / Net Profit (%): 100.00% – Internal diagnostic score: 1.00
• Cash-UP (Cash to Market Value): -9.61% – Internal diagnostic score: 2.00
• Cash-MV (Cash to Market Value): -84.09% – Internal diagnostic score: 2.00
• Interest Coverage Ratio (EBIT / Interest Expense %): -89.86% – Internal diagnostic score: 1.00

The fundamentals show a mixed picture. While some metrics like net profit growth and operating cash flow are strong, key liquidity and profitability ratios like GPM and interest coverage show weakness. This suggests MPWR is struggling with margin pressures despite top-line performance.

Money-Flow Trends

Big-Money vs. Retail Flows: Despite a weak price performance of -1.71%, institutional money is still positive in direction. The overall inflow ratio stands at 51.94%, with large, extra-large, and block flows all positive. In contrast, small flows are negative at 49.71%. This suggests that larger players are still betting on the stock despite retail caution.

• Large Inflow Ratio: 51.75%
• Extra-Large Inflow Ratio: 52.11%
• Block Inflow Ratio: 52.04%

The fund-flow score of 7.63 (internal diagnostic score) reflects positive institutional sentiment, but this is not translating into positive price action at the moment.

Key Technical Signals

Monolithic Power's technical indicators have turned decisively bearish in the past five days. With four negative patterns and no bullish ones, the internal diagnostic score stands at a low 2.17. The bearish signals include a MACD Death Cross and a Marubozu White pattern, both of which signal weakness and potential continuation of the downward trend.

Recent Chart Patterns and Scores

• MACD Death Cross – Internal diagnostic score: 1.00 (2025-08-28)
• Marubozu White – Internal diagnostic score: 1.00 (2025-08-26)
• WR Overbought – Internal diagnostic score: 2.26 (2025-08-27)
• Piercing Pattern – Internal diagnostic score: 1.00 (2025-08-18)

These signals reinforce the idea of a weak market sentiment. The key insights from the technical analysis highlight that the market is currently in a weak state with a clear risk of further decline.

Conclusion

Monolithic Power remains a stock to watch with caution. The bearish technical signals are strong and unrelenting, supported by mixed analyst ratings and weak liquidity metrics. While institutional money is still positive, retail sentiment appears to be cooling off. Given the current technical weakness and the divergence between fundamentals and price action, investors may want to wait for a clearer signal of a bottom or consider avoiding the stock until the trend stabilizes.