_edited.png)
RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Monolithic Power Systems, Inc. (XNAS:MPWR) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
MPWR
Name:
MONOLITHIC POWER SYSTEMS, INC. (XNAS:MPWR)
Sector:
80.54M
Industry:
Semiconductors
CEO:
Mr. Michael Hsing
Total Employees:
2,773
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -125.54% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF MONOLITHIC POWER SYSTEMS, INC.(MPWR) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SEMICONDUCTORS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
424.42
One Month Price Target:
$427.07
Six Month Price Target :
$440.3
Likely Price in One Year's Time:
Ticker:
$456.18
Likely Trading Range Today Under (Normal Volatility)
$422.75
Price Upper limit ($) :
$427.74
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$395.04
This week:
$358.73
This month :
$293.03
Other Primary facts
Market Cap:
19.60B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
46.79M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
17.01%
-20.28%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$560.55
$496.80
$288.29
$352.04
Medium risk (<10%) entry points
Buy Call
Sell Call
$476.05
Buy Put:
Sell Put:
$462.44
$372.61
$386.40
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
MPWR
Sharpe Ratio:
5.35%
Comparison:
MPWR, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 72.62% higher than the industry
& ratio is 134.50% higher than the market/S&P 500 average
Average Returns/Yield of
MPWR
Daily returns:
0.19%
Weekly returns:
0.97%
Monthly returns:
3.88%
Yearly returns:
31.95%
Comparison of returns:
Average annual returns/yield (last 3 years) is 45.79% above industry average
Classification:
MPWR, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.77
Statistical test of Returns:
MPWR has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.47%
Weekly Volatility:
7.75%
Monthly Volatility:
15.50%
Yearly Volatility:
53.68%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
2.91%
Volatility in last five trading days has been -16.14% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.92%
Weekly VaR:
-15.48%
Monthly VaR:
-30.96%
How Much Can the price of
MPWR
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-25%
Worst case (decline):
>85%
This translates to price declining to:
$317.71
This translates to price declining to:
$63.66
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
MPWR is a 118.49% riskier investment compared to the market/S&P 500 & is 87.18% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -2.37% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
MPWR
Beta in relation to market/S&P 500--1.11
Expected beta in 1 year's time:
0.83
Expected beta in 3 year's time:
1.174
Unlevered (debt free) Beta:
0.892
Beta in relation to Nasdaq (XNAS):
1.569
Beta in relation to all global stocks::
1.026
Beta Comparison & Analysis
Beta of competitors/peers::
1.141
Beta is -2.40% lower than peers
Average Industry Beta:
1.41
Beta is -21.05% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
9.62%
Sustainable growth rate is -65.22% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.358
Alpha is 87.08% above industry average alpha yield
Alpha is 2279% higher than market/& is unsustainably high
Analysis of Cost of Capital of
MPWR
Equity cost of capital:
0.108
Equity cost of capital is -15.88% below industry mean WACC
Unlevered (without debt) cost of capital:
8.63%
Before-tax cost of debt:
-
After-tax cost of debt:
-
Overall debt rating:
-
Weighted average cost of capital (WACC):
-
-
Key Per-Share Metrics & Analysis
Revenue per share:
$28.45
Revenue growth rate per share of (3Y):
14.97
Annual revenue growth rate is 207.60% above the industry average
EPS:
$5.75
Expected Annual growth rate of EPS (3Y):
26.08%
Expected future EPS growth rate is -49.99% lower than the Semiconductors industry
Free cash flow (FCF) per share:
$5.60
Balance sheet equity growth per share: 111.70%
Equity growth rate per share is 688.91% higher than the industry
Debt per share
$0.00
EBITDA per share
$7.78
Valuation Analysis Today of
MPWR
P/E Ratio:
60.91
P/E Ratio of Competitors/Peers:
236.24
P/E ratio is -74.22% lower than main peers & is 46.86% higher than the industry
Stock price/value with industry average P/E ratio: $238.49
MPWR is 77.96% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $122.87
Present value of the expected future dividends only: $76.49
P/S (Price to Sales ratio):
14.92
Price to sales ratio is 83.55% above the industry mean
P/B (Price to book value ratio):
14.97
Price to free cash flow: 75.74
-
Net income growth rate (3Y):
111.29%
Net income growth rate is -294.29% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 10.44%
Dividend yeild: 0.64%
Previous Dividend: $0.75
Previous adjusted dividend: $0.75
Previous Dividend: $2.70
Expected next dividend best case: $0.84
Expected next dividend worst case: $0.66
Average dividend payment (long-term): $0.57
Average dividend increase/decrease (growth rate) % per period: 7.00%
Expected next dividend payment date: 13/10/2022
Expected next dividend record date: 28/09/2022
-
Previous dividend payment date: 15/07/2022
Previous dividend record date: 30/06/2022
-
Dividend History:
2022-06-29--$0.75
2021-12-30--$0.60
2021-06-29--$0.60
2022-03-30--$0.75
2021-09-29--$0.60
2021-03-30--$0.60
Dividend growth rate is 163.65% higher than the average industry
In-depth Debt & Leverage Analysis
Debt to equity ratio:
28.66%
Net debt to equity ratio:
-19.65%
Debt to assets ratio:
22.27%
Net debt to assets ratio:
-15.20%
Debt-to-asset ratio is -42.86% below industry average
Ability to repay debt:
Interest coverage ratio:
28.41
Interest coverage ratio is -13.33% less than industry average
Looking forward:
Debt growth rate:
-100.00%
Annual debt growth is -209% lower than industry average debt growth rate
-
Analysis of Key Statistics
Correlation of price movement with the market:
0.743
Statistical significance of correlation:
MPWR has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.627
Stock price is 18.49% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.627
Correlation of price movement with Nasdaq (^IXIC):
-0.016
Covariance of price movement with the market:
-0.033
Kurtosis
4.222
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.071
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
MPWR
Gross Profit Margin Ratio:
229%
Operating Profit Margin Ratio:
23.47%
Operating profit margin is -0.23% lower than the industry
Net Profit Margin Ratio:
229%
Effective Tax Rate:
13.44%
Effective tax rate is -10.96% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
20.83%
Return on equity (ROE) is -27.17% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
16.11%
Return on assets (ROA) is 22.41% higher than the industry
Financial Leverage:
1.3x
Current Ratio:
4.58
Current ratio is 12.68% above industry average
Cash Conversion Cycle (days):
18.4
Cash conversion cycle is -66.73% below industry average
The remaining useful life of property plant & equipment is: 6.3 years
Stock based compensation to net income ratio:
14.42%
In-depth Efficiency Analysis
Revenue generated per employee:
480.0K
Each employee generates -23% less revenue than industry average revenue per employee
EBITDA generated per employee:
131.3K
Each employee generates -44% less EBITDA than industry average revenue per employee
Profit generated per employee:
99.6K
Each employee generates -38% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
29.0K
Each employee generates 5% more free cash flow than industry average revenue per employee
Assets/Capital per employee
168.4K
Each employee generates 5% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 38.54%
Growth rate in R&D investment/expenditure is 172.18% higher than the industry
Competitors/Peer firms of
MPWR
ENTEGRIS, INC. (XNAS:ENTG)
MONGODB, INC. (XNAS:MDB)
PTC INC. (XNAS:PTC)
NUANCE COMMUNICATIONS, INC. (XNAS:NUAN)
WIX.COM LTD (XNAS:WIX)
CITRIX SYSTEMS, INC. (XNAS:CTXS)
LYFT, INC. (XNAS:LYFT)
ON SEMICONDUCTOR CORPORATION (XNAS:ON)
NICE LTD (XNAS:NICE)
Current Analyst Ratings
Strong buy�13%
Buy�17%
Hold�8%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
1.33B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
567.78M
763.28M
202.84M
-
241.89M
-
-
444.73M
12.82M
12.82M
32.29M
364.15M
312.47M
276.18M
319.05M
42.87M
276.18M
Statement of Cash Flow
Date:
Period:
9.12M
Differed Income Tax :
- 381.00K
Stock Based Compensation :
39.81M
Change in Working Capital :
- 24237.00K
Accounts Receivables:
- 15506.00K
Other Working Capital:
27.38M
Other Non-Cash Items:
3.55M
Net Cash Provided by Operating Activities:
107.42M
Investments in PP&E:
- 26877.00K
Net Acquisitions:
-
Purchases of Investments:
- 16243.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
260.60M
512.91M
773.51M
142.55M
311.04M
20.04M
1.25B
369.37M
6.57M
-
-
22.85M
68.05M
466.85M
-
1.71B
71.57M
-
18.82M
6.98M
193.97M
272.53M
-
115.34M
115.34M
-
387.87M
847.97M
467.84M
10.3M
-
March 31, 2022 at 6:00:00 AM
1.01B
1.33B
1.71B
-
-
- 260604.0K
32.27M
- 760.00K
- 11613.00K
-
-
-
- 28825.00K
4.58M
- 24249.00K
- 220.00K
71.34M
260.73M
189.39M
107.42M
- 26877.00K
80.54M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
MPWR
2023
2024
2025
2026
2027
$458.46
$885.27
$951.51
$1,022.70
$1,099.22