What's In Store For Monolithic Power In Q3? Analyst Sees Flattish Growth In Auto Owing To Multiple Delayed Customer Launches
Portfolio Pulse from Nabaparna Bhattacharya
Oppenheimer analyst Rick Schafer has reiterated the Outperform rating on Monolithic Power Systems, Inc. (NASDAQ:MPWR), but lowered the price target from $565 to $500. The company is expected to report in-line 3Q/4Q results, with strength in AI and auto. However, auto is expected to be flat in 3Q and 4Q due to two delayed customer launches. Schafer expects the company's order velocity to pick up in 1H24 and estimates AI servers to be up >30% this year. MPWR's transition to BCD4 and BCD5 is expected to give it a sustainable cost advantage over competitors.
October 27, 2023 | 7:31 pm
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NEUTRAL IMPACT
Monolithic Power Systems' price target has been lowered from $565 to $500 by Oppenheimer analyst Rick Schafer, who still maintains an Outperform rating. The company's auto sector is expected to be flat in 3Q and 4Q due to delayed customer launches, but AI servers are expected to be up >30% this year.
The lowering of the price target by the analyst could potentially have a negative impact on the stock price in the short term. However, the Outperform rating and the expected strength in AI and auto sectors could balance this out, leading to a neutral score. The company's transition to BCD4 and BCD5, which is expected to give it a cost advantage over competitors, could also be a positive factor.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100