Rosenblatt Securities analyst Hans Mosesmann reiterated a Buy rating on Monolithic Power Systems, Inc. (NASDAQ:MPWR), raising the price target to $750 from $550.

The analyst increased the price target, foreseeing a cyclical analog with an embedded bottom visible in the first half of 2024. 

The rise is attributed to a substantial power analog AI roadmap/pipeline filling in the power analog AI sector.

Mosesmann also highlighted that the SoC AI industry design momentum assured a strong multi-year dynamic that required more sophisticated power analog and liquid cooling techniques.

Key to the story is the company's deep and sustained relationship with NVIDIA Corporation (NASDAQ:NVDA) and other AI accelerator chip players in power analog chips, sub-systems, and/or modules.

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The company is also likely to gain from significant dollar content expansion in automotive platforms as the industry chases Tesla, Inc (NASDAQ:TSLA) EV/autonomous driving innovation that prizes MPS programmable over-the-air power analog solutions.

For FY23, the analyst expects the company's revenues to be $1.82 billion, with EPS of $11.73.

For FY24, Mosesmann projects the company's revenues of $1.84, with an EPS of $11.00.

For FY25, the analyst forecasts EPS of $14.50, with revenues totaling $2.20 billion.

The analyst's price target of $750 underscores earnings power approaching $20 for FY25 (vs. estimate of $14.50), using a high-30's P/E multiple justified by a sustainable 20% plus sales CAGR with increasing margins, the analyst adds. 

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Price Action: MPWR shares are trading higher by 3.62% to $640.02 on the last check Tuesday.

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