It has been about a month since the last earnings report for Monolithic Power (MPWR Quick QuoteMPWR - Free Report) . Shares have lost about 1.6% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Monolithic due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Monolithic Power Q4 Earnings & Revenues Top Estimates

Monolithic Power reported first-quarter 2022 non-GAAP earnings of $2.45 per share, which beat the Zacks Consensus Estimate by 8.4%. The bottom line improved 67.8% on a year-over-year basis.

Quarter Details

Revenues of $377.7 million rose 48.4% from the year-ago quarter’s figure and surpassed the Zacks Consensus Estimate by 4.9%. On a sequential basis, the top line grew 12.2%. Strong demand across all six end markets drove the year-over-year growth.

In the quarter, the company reorganized its markets and segregated Computing and Storage into two — Storage and Computing, and Enterprise Data.

Storage and Computing (25.6% of total revenues) revenues increased 88.3% year over year to $96.6 million. The performance was driven by an increase in market share for storage applications.

Enterprise Data (11.3%) revenues were $42.5 million, up 162.3% from the prior-year quarter’s figure.

Automotive (14.4%) revenues were $54.5 million, up 21.4% from the prior-year quarter’s figure. The company is witnessing sales growth in infotainment, lighting and Advanced Driver Assistance Systems products.

Industrial (12.9%) revenues increased 21.9% year over year to $48.5 million, courtesy of higher industrial meters and power sources sales.

Communications (14.6%) revenues grew 54% to $55.6 million.

Consumer (21.2%) revenues moved up 20.8% from the year-ago quarter to $80 million.

By product family, revenues in DC to DC (95% of total revenues) surged 48.6% year over year to $358.8 million. Lighting Control (5%) revenues rallied 45.4% to $18.9 million.

Other Details

Non-GAAP gross margin expanded 250 basis points (bps) from the year-ago quarter’s level to 58.3%. Non-GAAP operating expenses amounted to $86.6 million, up 30.8%. Non-GAAP operating income rose 76.3% year over year to $133.6 million.

As of Mar 31, 2022, the company had $260.6 million in cash and cash equivalents with $65.6 million of other long-term liabilities.

Outlook

The company continues to execute on its long-term plan for sustainable growth. For the second quarter, it projects revenues between $420 million and $440 million. Non-GAAP gross margin is expected between 58.7% and 59.3%.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates review.

The consensus estimate has shifted 27.82% due to these changes.

VGM Scores

Currently, Monolithic has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Monolithic has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.