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Monolithic Power (MPWR) to Report Q2 Earnings: What's in Store?

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Monolithic Power Systems, Inc. (MPWR - Free Report) is scheduled to report second-quarter 2021 results on Jul 27.

For second-quarter 2021, the company projects revenues between $274 million and $286 million. The Zacks Consensus Estimate for fiscal second-quarter revenues is pegged at $280.7 million, which suggests year-over-year growth of 50.8%.

The consensus mark for earnings has been steady at $1.69 that indicates an increase of 56.5% year over year.

The company has a trailing four-quarter earnings surprise of 6.01%, on average.

Q1 Recap

Monolithic Power reported first-quarter 2021 non-GAAP earnings of $1.46 per share, which beat the Zacks Consensus Estimate by 9.77%. The bottom line surged 53.7% on a year-over-year basis.
 

Monolithic Power Systems, Inc. Price and EPS Surprise

 

Monolithic Power Systems, Inc. Price and EPS Surprise

Monolithic Power Systems, Inc. price-eps-surprise | Monolithic Power Systems, Inc. Quote

 

Revenues of $254.5 million climbed 9.2% from the year-ago quarter’s figure and surpassed the Zacks Consensus Estimate by 5.09%. The reported figure was also above the higher end of management’s guidance of $236-$248 million.

Let’s see how things are shaping up prior to this announcement.

Factors to Consider

Monolithic’s second-quarter top line is expected to have benefited from continued healthy demand across all the end-markets as well as incremental gains from strong uptake of new product introductions.

Consumer end market segment is anticipated to gain from increasing demand of wearables, gaming consoles and home-focused Internet of Things (IoT) applications along with the company’s new mobile device charging IC. The Zacks Consensus Estimate for the segment’s revenues is currently pegged at $74 million, which suggests year-over-year growth of 55.3%.

Stabilizing automotive sector along with increasing demand for safety, infotainment and connectivity application products is likely to drive the top line for automotive end-market segment. The Zacks Consensus Estimate for revenues in Automotive end markets is pegged at $48.18 million that suggests year-over-year growth 171%.

Industrial end-market segment is likely to benefit from continued demand for the segment’s major product lines. The Zacks Consensus Estimate is currently pegged at $42.33 million for the Industrial end-market, which suggest an increase of 59.2% year over year.

Communications end-market revenues are anticipated to have been driven by increases in demand for networking and wireless gateway home router products. Higher acceptance of the segment’s product lines by Tier 1 customers is expected to have positively contributed to the segment’s performance. The Zacks Consensus Estimate for revenues is currently pegged at $38 million for the Communications end-markets, indicating an increase 26.2% year over year.

Computing & Storage end-market segment’s performance is likely to have been driven by strong uptick in storage as well as high-end notebooks on growing clout of cloud computing. The Zacks Consensus Estimate for revenues is currently pegged at $78 million for the Computing and Storage end-markets, which indicates an increase of 21.9% year over year.

Increasing expenses on product development as well as supply chain disruptions stemming from resurgence in COVID-19 cases across several parts of the world might have affected the company’s performance in the to-be-reported quarter.

What Our Model Says

Our proven model doesn’t conclusively predict an earnings beat for Monolithic Power this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Monolithic Power has an Earnings ESP of -0.37% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some stocks, which you may consider, as our proven model shows that these have the right mix of elements to beat estimates this time around:

Garmin (GRMN - Free Report) has an Earnings ESP of +4.54% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Apple (AAPL - Free Report) has an Earnings ESP of +3.40% and carries a Zacks Rank of 2, at present.

Advanced Micro Devices (AMD - Free Report) has an Earnings ESP of +3.41% and currently carries a Zacks Rank of 2.