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Monolithic Power Systems Is Surging—Has Valuation Caught Up?
By Leo Miller. Article Published: 2/10/2026.
Key Points
- While other top chip stocks have lagged over recent months, Monolithic Power Systems continues to come through for investors.
- The company is now firing on all cylinders, having seen strong growth across all end markets last quarter.
- However, when it comes to achieving further upside, what is the outlook for MPWR shares?
Over the past three months, some of the biggest names in the semiconductor industry have stalled. NVIDIA (NASDAQ: NVDA) is up just 1% over that span, Broadcom (NASDAQ: AVGO) is down 1%, and Advanced Micro Devices (NASDAQ: AMD) has fallen more than 7%.
That hasn't been the case for the super‑charged chip stock Monolithic Power Systems (NASDAQ: MPWR). The stock has returned 26% over the past three months and 69% over the past 52 weeks.
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Monolithic posted its latest financial results on Feb. 5, which helped explain the stock's surge.
After such a strong run, is there still a compelling opportunity in MPWR shares?
MPWR Gets a Lift After Rock-Solid Earnings Report
In Q4 2025, Monolithic reported revenue of $751 million, up 21% year over year. That comfortably beat estimates near $742 million, which implied 19% growth. Adjusted earnings per share rose 17% to $4.79, topping estimates of $4.74 (16% growth).
The company's full-year performance was notable. Revenue increased more than 26%—its fastest growth rate since 2022—and operating margin rose by 60 basis points to 35.2%. Sales in five of the company's six end markets grew by 25% or more; the exception was enterprise data, where sales fell 2%. By Q4, every end market was generating at least 15% year‑over‑year sales growth.
In 2025, three of those end markets each accounted for at least 20% of total revenue, underscoring Monolithic's customer diversification. Markets rewarded the company after the Feb. 5 release: shares rose 6.4% the next day.
Monolithic Raises Data Center Forecasts, Sends 800 VDC Samples
Looking ahead, Monolithic expects revenue to grow more than 22% on the midpoint of its Q1 2026 guidance—well above forecasts that called for 16% growth. The firm reported a book‑to‑bill ratio "well in excess of one" last quarter, signaling robust demand and that orders outpaced sales. Its backlog now extends into Q3 2026.
The enterprise data segment, which includes data‑center sales, is especially strong. Monolithic raised its 2026 sales growth estimate for that market from 30–40% to a floor of 50%.
Further out, the company sees a large opportunity in 800‑volt direct‑current (VDC) data‑center architecture, an emerging power‑delivery system that NVIDIA is promoting. Monolithic says it was the first to ship product samples as it competes for the 800 VDC business. Revenue from this initiative likely won't materialize until late 2027 or beyond, but the update demonstrates the firm's technical readiness for high‑value data‑center deals.
Monolithic: Fantastic Executor, Premium Valuation
On the whole, Monolithic Power Systems is hard to fault operationally. The company executes well and benefits from favorable end‑market trends. The major caveat is valuation: the current share price embeds very aggressive free‑cash‑flow growth expectations for many years.
Even with strong data‑center tailwinds and diversified customers, that is a demanding assumption. Any stumble in execution could have an outsized negative impact on the stock, given how much optimism is already priced in.
The MarketBeat consensus price target for Monolithic sits near $1,218, implying roughly 1% upside. Analysts who updated targets after the earnings release are more bullish, averaging $1,309 (about 8% upside). Rosenblatt Securities' updated $1,000 target implies about 17% downside, while KeyCorp's $1,500 target implies roughly 24% upside.
Despite a valuation that may be approaching a ceiling, Monolithic remains a high‑quality company with potential for long‑term growth. Advances in power‑regulation chips and systems are critical to enabling progress across many parts of the economy, and Monolithic is well positioned in that space.
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