Critical Comparison: Monolithic Power Systems (NASDAQ:MPWR) versus Netlist (OTCMKTS:NLST)

Monolithic Power Systems (NASDAQ:MPWR – Get Rating) and Netlist (OTCMKTS:NLST – Get Rating) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, institutional ownership, dividends, earnings, analyst recommendations and profitability.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Monolithic Power Systems and Netlist, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Monolithic Power Systems	0	0	12	0	3.00
Netlist	0	0	0	0	N/A

Monolithic Power Systems presently has a consensus price target of $522.67, suggesting a potential upside of 7.03%. Given Monolithic Power Systems’ higher probable upside, equities research analysts plainly believe Monolithic Power Systems is more favorable than Netlist.

Valuation & Earnings

This table compares Monolithic Power Systems and Netlist’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Monolithic Power Systems	$1.79 billion	12.90	$437.67 million	$9.65	50.60
Netlist	$161.64 million	6.96	-$33.37 million	($0.19)	-24.16

Monolithic Power Systems has higher revenue and earnings than Netlist. Netlist is trading at a lower price-to-earnings ratio than Monolithic Power Systems, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Monolithic Power Systems and Netlist’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Monolithic Power Systems	25.06%	30.00%	23.99%
Netlist	-20.65%	-81.39%	-40.15%

Insider and Institutional Ownership

96.4% of Monolithic Power Systems shares are held by institutional investors. 2.0% of Monolithic Power Systems shares are held by company insiders. Comparatively, 3.1% of Netlist shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Volatility & Risk

Monolithic Power Systems has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500. Comparatively, Netlist has a beta of 1.22, indicating that its share price is 22% more volatile than the S&P 500.

Summary

Monolithic Power Systems beats Netlist on 11 of the 13 factors compared between the two stocks.

About Monolithic Power Systems

(Get Rating)

Monolithic Power Systems, Inc. designs, develops, and markets integrated power semiconductor solutions and power delivery architectures for computing and storage, automotive, industrial, communications, and consumer applications markets. It offers direct current (DC) to DC integrated circuits (ICs) that are used to convert and control voltages of various electronic systems, such as portable electronic devices, wireless LAN access points, computers and notebooks, monitors, infotainment applications, and medical equipment. The Firm also provides lighting control ICs for backlighting that are used in systems, which provide the light source for LCD panels in notebook computers, monitors, car navigation systems, and televisions, as well as for general illumination products. The company was founded by Michael R. Hsing, and James C. Moyer on August 22, 1997, and is headquartered in Kirkland, WA.

About Netlist

(Get Rating)

Netlist, Inc. engages in the design, manufacture and sale of memory subsystems for the computing and communications markets. Its products include storage class memory, non volatile memory, embedded flash, specialty dimms and NVME SSD. The company was founded by Jayesh Bhakta, Chun Ki Hong and Christopher Lopes in June 2000 and is headquartered in Irvine, CA.