Definitive Analysis
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Monolithic Power Systems, Inc. (MPWR)

Company Dividend Discount ModelIndustry: SemiconductorsSector: Technology

Valuation Snapshot

Stable Growth$923.43 - $2,449.62$1,412.03
Multi-Stage$624.75 - $682.99$653.34
Blended Fair Value$1,032.68
Current Price$920.64
Upside12.17%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS29.02%35.35%5.003.862.872.271.841.400.990.700.690.62
YoY Growth--29.48%34.70%26.15%23.18%31.94%41.75%39.94%2.50%10.46%157.03%
Dividend Yield--0.86%0.58%0.57%0.47%0.52%0.83%0.70%0.61%0.75%0.98%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)1,895.15
(-) Cash Dividends Paid (M)271.84
(=) Cash Retained (M)1,623.32
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)379.03236.89142.14
Cash Retained (M)1,623.321,623.321,623.32
(-) Cash Required (M)-379.03-236.89-142.14
(=) Excess Retained (M)1,244.291,386.421,481.18
(/) Shares Outstanding (M)48.1448.1448.14
(=) Excess Retained per Share25.8528.8030.77
LTM Dividend per Share5.655.655.65
(+) Excess Retained per Share25.8528.8030.77
(=) Adjusted Dividend31.4934.4536.41
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Fair Value$923.43$1,412.03$2,449.62
Upside / Downside0.30%53.37%166.08%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)1,895.152,018.342,149.532,289.252,438.052,596.532,674.42
Payout Ratio14.34%29.47%44.61%59.74%74.87%90.00%92.50%
Projected Dividends (M)271.84594.90958.821,367.541,825.342,336.872,473.84

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)540.17545.29550.41
Year 2 PV (M)790.52805.57820.77
Year 3 PV (M)1,023.761,053.151,083.09
Year 4 PV (M)1,240.761,288.481,337.56
Year 5 PV (M)1,442.331,512.001,584.33
PV of Terminal Value (M)25,038.8526,248.2427,503.91
Equity Value (M)30,076.3931,452.7332,880.07
Shares Outstanding (M)48.1448.1448.14
Fair Value$624.75$653.34$682.99
Upside / Downside-32.14%-29.03%-25.81%

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