Is NASDAQ:MPWR on the Verge of a Major Breakout as a Strong Growth Stock?

Last update: Dec 13, 2024

In this article we will dive into MONOLITHIC POWER SYSTEMS INC (NASDAQ:MPWR) as a possible candidate for growth investing. Investors should always do their own research, but we noticed MONOLITHIC POWER SYSTEMS INC showing up in our strong growth, ready to breakout screen, which makes it worth to investigate a bit more.

A Closer Look at Growth for NASDAQ:MPWR

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NASDAQ:MPWR scores a 8 out of 10:

MPWR shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 25.79% yearly.
MPWR shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.62%.
The Revenue has been growing by 25.61% on average over the past years. This is a very strong growth!
Based on estimates for the next years, MPWR will show a very strong growth in Earnings Per Share. The EPS will grow by 20.29% on average per year.
MPWR is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 17.89% yearly.

Health Assessment of NASDAQ:MPWR

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NASDAQ:MPWR has earned a 9 out of 10:

An Altman-Z score of 37.81 indicates that MPWR is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 37.81, MPWR belongs to the top of the industry, outperforming 94.44% of the companies in the same industry.
There is no outstanding debt for MPWR. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
MPWR has a Current Ratio of 6.42. This indicates that MPWR is financially healthy and has no problem in meeting its short term obligations.
With an excellent Current ratio value of 6.42, MPWR belongs to the best of the industry, outperforming 88.89% of the companies in the same industry.
MPWR has a Quick Ratio of 5.16. This indicates that MPWR is financially healthy and has no problem in meeting its short term obligations.
MPWR's Quick ratio of 5.16 is amongst the best of the industry. MPWR outperforms 87.96% of its industry peers.

Looking at the Profitability

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:MPWR scores a 9 out of 10:

MPWR has a better Return On Assets (15.21%) than 87.04% of its industry peers.
MPWR has a better Return On Equity (18.47%) than 81.48% of its industry peers.
The Return On Invested Capital of MPWR (16.20%) is better than 90.74% of its industry peers.
MPWR had an Average Return On Invested Capital over the past 3 years of 19.99%. This is significantly above the industry average of 11.23%.
The Profit Margin of MPWR (21.29%) is better than 81.48% of its industry peers.
In the last couple of years the Profit Margin of MPWR has grown nicely.
With an excellent Operating Margin value of 23.83%, MPWR belongs to the best of the industry, outperforming 84.26% of the companies in the same industry.
In the last couple of years the Operating Margin of MPWR has grown nicely.
With a decent Gross Margin value of 55.29%, MPWR is doing good in the industry, outperforming 76.85% of the companies in the same industry.

How does the Setup look for NASDAQ:MPWR

In addition to the Technical Rating, ChartMill provides a Setup Rating for each stock. This rating, ranging from 0 to 10, assesses the extent of consolidation in the stock based on multiple short-term technical indicators. Currently, NASDAQ:MPWR has a 7 as its setup rating:

Although the technical rating is bad, MPWR does present a nice setup opportunity. Prices have been consolidating lately. There is very little resistance above the current price. There is a support zone below the current price at 567.63, a Stop Loss order could be placed below this zone.

Our Strong Growth screener lists more Strong Growth stocks and is updated daily.

Our latest full fundamental report of MPWR contains the most current fundamental analsysis.

For an up to date full technical analysis you can check the technical report of MPWR

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.