Monolithic Power Systems Inc. (NASDAQ:MPWR) stock fell nearly 7% Monday as semiconductor and high-valuation technology stocks came under pressure. The Nasdaq fell 0.82%, while the S&P 500 lost 0.39%.
Technology was the worst-performing sector, down 1.7%.
Monolithic Power’s decline came amid a broader rotation away from technology stocks. Seven of the 11 major sectors traded lower.
However, MPWR fell much more sharply than the broader technology sector. The stock underperformed the sector by about 5 percentage points.
Meanwhile, Communication Services rose 1.79%, Healthcare gained 1.50% and Consumer Staples climbed 1.48%. The moves pointed to a rotation away from growth-oriented technology stocks.
GlobalFoundries, Monolithic Power Systems Partner On Power Chips
Separately, GlobalFoundries Inc. (NASDAQ:GFS) and Monolithic Power announced a long-term manufacturing partnership on Wednesday to expand production of high-performance power chips.
Under the agreement, Monolithic Power Systems will deploy its proprietary process technology at GlobalFoundries’ 300mm manufacturing facility in Singapore. The companies expect additional manufacturing capacity to come online in early 2027.
The Singapore facility is expected to produce next-generation power solutions for automotive systems, industrial robotics and automation. It will also make smart power stages for AI and cloud infrastructure.
The companies said the partnership will combine Monolithic Power Systems’ technology with GlobalFoundries’ manufacturing scale. The deal is expected to increase capacity and strengthen supply assurance for customers.
See More: Top Value Stocks
Technical Analysis
MPWR is trading below all four major moving averages. The stock is about 9% below its 20-day simple moving average and 12.6% below its 50-day SMA. It is also 19.5% below its 100-day SMA and 8.6% below its 200-day SMA.
Momentum remains bearish. The MACD is below its signal line, while the histogram is negative.
In addition, the 20-day SMA is below the 50-day SMA. That signals near-term weakness. However, the 50-day SMA remains above the 200-day SMA, keeping the longer-term trend more constructive.
Critical Levels: Resistance sits near $1,250, close to the 200-day SMA zone. Support is near $996.
Analyst Outlook
The stock carries a Buy consensus rating. Its average price forecast is $1,814.25, with forecasts ranging from $1,500 to $2,100 across 13 analysts.
StoneX initiated coverage with a Buy rating and a $1,800 price forecast on Sept. 3. Wells Fargo maintained an Overweight rating and raised its forecast to $1,800 on July 31. Truist Securities maintained a Buy rating and raised its forecast to $1,889 the same day.
Monolithic Power Systems develops power management semiconductors, including voltage regulators. It serves data center, automotive, industrial, communications and consumer markets. The company operates a fabless manufacturing model and works with third-party foundries using its proprietary process technology.
Benzinga Edge Rankings
The Benzinga Edge scorecard shows strong Growth and Quality scores but weak Value.
MPWR has a Momentum score of 74.3, Quality score of 87.36 and Growth score of 88.75. Its Value score is just 7.44.
The combination highlights MPWR’s strong growth profile but premium valuation. That valuation could increase downside pressure when investors pull away from high-growth technology stocks.
Top ETF Exposure
MPWR has a 4.94% weighting in the VanEck Morningstar Wide Moat Growth ETF (NASDAQ:MGRO). It also accounts for 8.85% of the First Trust NASDAQ Clean Edge Green Energy Index Fund (NASDAQ:QCLN) and 4.25% of the VanEck Fabless Semiconductor ETF (NASDAQ:SMHX).
As a result, large inflows or outflows from these funds can affect demand for MPWR shares.
Price Action
MPWR Price Action: Monolithic Power Systems shares were down 6.84% at $1,150.05 at the time of publication Monday, according to Benzinga Pro data.
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