Monolithic Power Systems, Inc. (MPWR): fair value, margin of safety and Wheel Score

Is MPWR undervalued?

MPWR closed at 1,249.20 on 16 Oct 2026, more than 30% above the GLS average fair value of 395.03. Only 0 of the 9 models that produced a value sit above the price. By our models the shares are priced well beyond what the filed earnings, cash flow and book value support; the Sunday Scan drops names like this at the "below fair value" rule.

The 9 models disagree widely: DDM gives 111.24 while GLS Growth gives 995.78. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.

The nightly engine files MPWR under High Growth: revenue and earnings growing fast enough that the growth-based models carry the valuation.

Nine valuation models for MPWR

Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.

Quality and financial health

Financial health is average - MPWR passes 6 of the nine Piotroski tests, which passes the Sunday Scan's "6 or more" rule. The Financials tab on the Quote page shows which tests fail. The GLS Moat score is 7.6 out of 10, built from ten years of revenue, earnings, margins, cash flow, share count and returns on capital scored for consistency - a high reading that points to a durable business.

Returns on capital are high - ROIC 17.3%, ROE 17.4%, ROA 14.7% - with debt at 0.01 times equity and a free-cash-flow yield of 1.0%.

The dividend yield is 0.61% with a payout ratio of 41% - a small yield that leaves most of the earnings in the business. Revenue comes mainly from DC To DC Products 99%, Lighting Control Products 1% (quarter Q3 FY2024).

Institutional ownership scores 10/10, insider activity 1/10 and Congressional trading 1/10 on the GLS smart-money scales.

Wheel Score 61: Fair

MPWR scores 61 out of 100 on the Wheel Score (Fair band, 50-64): a usable but unremarkable fit for the wheel strategy. The parts: Value 0/25, Health 13/20, Moat 11/15, Premium 19/20, Stability 16/20. Value (0/25) is where the points are missing.

Implied volatility is 63% on the near-the-money contracts 20-60 days out - above the 60% ceiling of the sweet spot. Premiums are large, but the Wheel Score tapers the Premium points (19 of 20) because volatility this high usually comes with a reason. Chain open interest is 14,049 contracts across all expiries - enough for the wheel at normal size.

Volume runs at 978k shares a day on a market cap of $61.4B, with a beta of 1.68 - a high beta, so the stock tends to move more than the market and a strike can be gapped through; the Stability part of the Wheel Score gives that 16 of 20.

The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.

Upcoming events

Monolithic Power Systems, Inc. reports earnings on 29 Oct 2026 (after the close) - inside the 14-day window the Sunday Scan avoids, because a put sold now would carry the report's gap risk.

Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.

Similar stocks in Semiconductors

The 12 companies below are the closest to Monolithic Power Systems, Inc. by market cap within the Semiconductors industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.

⚖ Compare MPWR with 7 of them   All Technology stocks →