We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Monolithic (MPWR) Up 3.1% Since Last Earnings Report: Can It Continue?
Read MoreHide Full Article
It has been about a month since the last earnings report for Monolithic Power (MPWR - Free Report) . Shares have added about 3.1% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Monolithic due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Monolithic Power Q1 Earnings & Revenues Top Estimates
Monolithic Power Systems, Inc. reported first-quarter 2020 non-GAAP earnings of 95 cents per share, which beat the Zacks Consensus Estimate by 1%. Notably, the figure increased 13.1% on a year-over-year basis.
Revenues of $165.8 million increased 17.3% from the year-ago quarter’s figure and surpassed the Zacks Consensus Estimate by 3.4%. The reported figure was also towards the higher end of management’s guidance of $161-$167 million.
Strong demand across Computing & Storage and Automotive and Communications end-markets as well as a diversified multi-market strategy drove year-over-year growth.
Quarter in Details
Revenues by Product Family
Revenues in the DC to DC segment (94.6% of total revenues) increased 18.2% year over year to $156.8 million. Moreover, Lighting Control (5.4% of total revenues) revenues increased 2.9% to $8.9 million.
Revenues by End Market
Computing & Storage (31.3% of total revenues) revenues rallied 32.6% year over year to $52 million. The market’s solid performance was driven by robust sales of cloud servers and storage.
Consumer (22.6%) revenues dropped 1.9% from the year-ago quarter’s figure to $37.4 million due to softening demand for set-top boxes and flat-panel TVs.
Industrial (15.2%) revenues increased 18.3% year over year to $25.2 million due to strong performance of games, smart meters and security applications.
Automotive (14.1%) revenues were $23.3 million, up 13.6% year over year. This was driven by sales of infotainment, safety and connectivity application products.
Communications (16.8%) revenues rallied 25.6% year over year to almost $27.9 million. The end-market benefited from strong 5G networking sales.
Margins in Detail
Non-GAAP gross margin contracted 10 basis points (bps) from the year-ago quarter’s level to 55.5%. Management had predicted the figure to be between 55.4% and 56%.
Non-GAAP operating expenses amounted to $46.1 million during the reported quarter, up 18.1% year over year. As a percentage of revenues, the figure expanded 20 bps on a year-over-year basis to 27.8%.
Non-GAAP operating income improved almost 9% year over year to $45.9 million. Non-GAAP operating margin (as a percentage of revenues) contracted 30 bps from the year-ago quarter’s level to 27.7%.
Balance Sheet & Cash Flow
As of Mar 31, 2020, cash, cash equivalents and short-term investments were $489.3 million, up from $455.4 million reported as of Dec 31, 2019.
Monolithic Power generated operating cash flow of approximately $51.4 million compared with $61 million in the prior quarter.
Guidance
For second-quarter 2020, Monolithic Power projects revenues between $167 million and $173 million
Management anticipates non-GAAP gross margin between 55.3% and 55.9%.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 10.62% due to these changes.
VGM Scores
Currently, Monolithic has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Monolithic has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Monolithic (MPWR) Up 3.1% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Monolithic Power (MPWR - Free Report) . Shares have added about 3.1% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Monolithic due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Monolithic Power Q1 Earnings & Revenues Top Estimates
Monolithic Power Systems, Inc. reported first-quarter 2020 non-GAAP earnings of 95 cents per share, which beat the Zacks Consensus Estimate by 1%. Notably, the figure increased 13.1% on a year-over-year basis.
Revenues of $165.8 million increased 17.3% from the year-ago quarter’s figure and surpassed the Zacks Consensus Estimate by 3.4%. The reported figure was also towards the higher end of management’s guidance of $161-$167 million.
Strong demand across Computing & Storage and Automotive and Communications end-markets as well as a diversified multi-market strategy drove year-over-year growth.
Quarter in Details
Revenues by Product Family
Revenues in the DC to DC segment (94.6% of total revenues) increased 18.2% year over year to $156.8 million. Moreover, Lighting Control (5.4% of total revenues) revenues increased 2.9% to $8.9 million.
Revenues by End Market
Computing & Storage (31.3% of total revenues) revenues rallied 32.6% year over year to $52 million. The market’s solid performance was driven by robust sales of cloud servers and storage.
Consumer (22.6%) revenues dropped 1.9% from the year-ago quarter’s figure to $37.4 million due to softening demand for set-top boxes and flat-panel TVs.
Industrial (15.2%) revenues increased 18.3% year over year to $25.2 million due to strong performance of games, smart meters and security applications.
Automotive (14.1%) revenues were $23.3 million, up 13.6% year over year. This was driven by sales of infotainment, safety and connectivity application products.
Communications (16.8%) revenues rallied 25.6% year over year to almost $27.9 million. The end-market benefited from strong 5G networking sales.
Margins in Detail
Non-GAAP gross margin contracted 10 basis points (bps) from the year-ago quarter’s level to 55.5%. Management had predicted the figure to be between 55.4% and 56%.
Non-GAAP operating expenses amounted to $46.1 million during the reported quarter, up 18.1% year over year. As a percentage of revenues, the figure expanded 20 bps on a year-over-year basis to 27.8%.
Non-GAAP operating income improved almost 9% year over year to $45.9 million. Non-GAAP operating margin (as a percentage of revenues) contracted 30 bps from the year-ago quarter’s level to 27.7%.
Balance Sheet & Cash Flow
As of Mar 31, 2020, cash, cash equivalents and short-term investments were $489.3 million, up from $455.4 million reported as of Dec 31, 2019.
Monolithic Power generated operating cash flow of approximately $51.4 million compared with $61 million in the prior quarter.
Guidance
For second-quarter 2020, Monolithic Power projects revenues between $167 million and $173 million
Management anticipates non-GAAP gross margin between 55.3% and 55.9%.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 10.62% due to these changes.
VGM Scores
Currently, Monolithic has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Monolithic has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.