Monolithic Power Systems, Inc. (MPWR)

FairStock Score: 55/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look for businesses that earn high returns, carry little debt, and can be bought at a sensible price. Monolithic Power Systems is clearly a quality operator. In fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $980.6M and net income was $257.3M, up from $664.6M and $135.0M in fiscal Q2 2025, the quarter ended 2025-06-30. That is 47.6% revenue growth and 90.6% profit growth, with a 26.24% net margin. FairStock's calculated ROE is 21.98%, ROCE 13.57%, and debt/equity is 0.00, while the Altman Z-Score of 50.99 suggests a fortress balance sheet. The company designs power electronics for AI servers, CPU servers, memory, storage, notebooks, appliances, and network infrastructure. The moat is not obvious from the filed figures alone; high returns and a debt-free balance sheet hint at some competitive advantage, but semiconductors remain cyclical. But quality is not the same as value. At the 2026-10-13 close of $1319.55, FairStock calculates a P/E of 80.26, P/B of 16.65, EV/EBITDA of 63.84, and FCF yield of only 0.9% on $582.6M trailing free cash flow. FairStock's Graham Number is $171.24, leaving a margin of safety of -670.59%. The PEG ratio of 0.89 is more forgiving, but the Lynch category is CYCLICAL—semiconductors, because earnings follow the economic cycle. Filed annual figures also show volatility: FY2024 net income was $1.6B with EPS of $32.60, while FY2025 net income was $621.5M with EPS of $12.86 despite revenue rising to $2.8B. A beta of 1.66 and a 52-week range of $833.18 to $1714.09 confirm the swings. This is a fine business, but the price leaves little room for error if growth slows.

In plain English: Monolithic Power Systems makes power-management chips that control and convert electricity in servers, AI systems, notebooks, appliances and network gear. The business looks strong: latest filed quarter revenue and profit rose sharply from a year earlier, and it carries no debt. At the recent price, however, the stock looks expensive compared with its current earnings and cash generation, so much of the strong growth already appears to be reflected in the price.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-K (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer