Monolithic Power Systems, Inc. (NASDAQ:MPWR) came out with its quarterly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. It was a workmanlike result, with revenues of US$804m coming in 2.8% ahead of expectations, and statutory earnings per share of US$3.92, in line with analyst appraisals. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Taking into account the latest results, the most recent consensus for Monolithic Power Systems from 15 analysts is for revenues of US$3.70b in 2026. If met, it would imply a sizeable 25% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 40% to US$19.31. In the lead-up to this report, the analysts had been modelling revenues of US$3.39b and earnings per share (EPS) of US$17.07 in 2026. So it seems there's been a definite increase in optimism about Monolithic Power Systems' future following the latest results, with a nice increase in the earnings per share forecasts in particular.

It will come as no surprise to learn that the analysts have increased their price target for Monolithic Power Systems 27% to US$1,797on the back of these upgrades. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Monolithic Power Systems at US$2,000 per share, while the most bearish prices it at US$1,500. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Monolithic Power Systems' rate of growth is expected to accelerate meaningfully, with the forecast 35% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 19% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 21% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Monolithic Power Systems to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Monolithic Power Systems' earnings potential next year. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Monolithic Power Systems analysts - going out to 2028, and you can see them free on our platform here.

You still need to take note of risks, for example - Monolithic Power Systems has 2 warning signs we think you should be aware of.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.