MPWR
Monolithic Power Systems, Inc.
$1,589.81
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 119.6% above fair value
You pay
$1,589.81
Bear
$467.09
Fair
$724.07
Bull
$1,017.18
Bear
$467.09
-70.6%
10% stage 1 growth, 12% discount
Fair
$724.07
-54.5%
16% stage 1 growth, 12% discount
Bull
$1,017.18
-36.0%
21% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (16% base case)
Terminal Value % of EV
39%
Implied Market Multiple
115.4x
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $1615.00 from 25 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $724.07 per share.
Warnings
Wall Street's average price target is $1615.00 (from 25 analysts). Our estimate is 74% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions