We recently published a list of 10 Best Growth Stocks to Invest in for the Next 10 Years. In this article, we are going to take a look at where Monolithic Power Systems, Inc. (NASDAQ:MPWR) stands against other best growth stocks to invest in for the next 10 years.
On March 8, Ben Snider, Goldman Sachs senior equity strategist, joined CNBC to discuss the state of the economy today. Snider noted that the key struggle has been the market struggle to assess the forward trajectory of the economy. The market entered this year with optimism for the growth trajectory. However, over the past few weeks, we have seen a very sharp downturn. There is good news to extract from the scenario. Snider explained that if we look at where the market is priced today, it seems much more reasonable. Therefore the base case remains the same the economy is in good shape and is growing. He also noted that a confirmation of the growth came in with the jobs report, moreover, earnings are still growing, meaning that the equity market should be moving higher too.
However, the key question that remains unanswered is what sectors investors should look forward to. Most of the sectors have been volatile. Therefore, as per Snider, the best approach would be not to go all in for a single sector. He likes healthcare, which has been one of the best-performing sectors in the market so far. This is because despite the performance the sector is still trading at the lowest valuations compared to the market. Snider mentioned that this may be a good buying period as historical data tells us that when an investor buys the S&P 500 down 5%, it generates a positive return on investment over the next 5 months 85% of the time.
Moreover, Goldman Sachs has anticipated moderate yet resilient global growth in 2025, driven by the strong performance of the United States. The firm expects the US economy to be a primary driver of global growth, supported by a robust labor market, consistent consumer spending, solid credit conditions, sufficient liquidity, and increased capital spending related to AI. In addition, regarding the tariff situation, Goldman Sachs believes that the “Fed Put” will come into play and ease monetary policy, however, terminal rates are expected to be higher than previously anticipated.
Our Methodology
To curate the list of the 10 best growth stocks to invest in for the next 10 years, we looked at various online rankings. Using these rankings we aggregated a list of best growth stocks for the next 10 years. Next, we checked the sales growth of each stock from Seeking Alpha and added only those companies that have grown more than 15% over the past 5 years. Lastly, we ranked the stocks in ascending order of the number of hedge fund holders, sourced from Insider Monkey’s Q4 2024 database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
An engineer examining a DC to DC integrated circuit board, looking for any flaws.
Monolithic Power Systems, Inc. (NASDAQ:MPWR)
5-Year Sales Growth: 28.58%
Number of Hedge Fund Holders: 51
Monolithic Power Systems, Inc. (NASDAQ:MPWR) is a fabless semiconductor company specializing in high-performance power management solutions. It designs, develops, and markets analog and mixed-signal integrated circuits for various markets, including storage and computing, enterprise data, automotive, industrial, communications, and consumer electronics.
In 2024, the company achieved its 13th consecutive year of growth, marked by significant revenue increases and strategic advancements. Monolithic Power Systems, Inc. (NASDAQ:MPWR) increased its full-year revenue by 21% year-over-year to reach $2.2 billion. Whereas the Q4 revenue grew 37% year-over-year to reach $621.7 million. Management attributed growth to a diversified market strategy, consistent execution, continuous innovation, and a strong customer focus.
The company has been focused on investing in new technologies and markets. Last year, Monolithic Power Systems, Inc. (NASDAQ:MPWR) introduced a silicon carbide inverter for high-powered clean energy applications, with initial revenue expected in late 2025. Moreover, the company also plans to introduce other silicon carbide-based applications in multiple regions during 2025 and 2026. On February 7, Truist raised the firm’s price target on the stock from $762 to $897. It is one of the best growth stocks to invest in for the next 10 years.
Artisan Mid Cap Fund stated the following regarding Monolithic Power Systems, Inc. (NASDAQ:MPWR) in its Q4 2024 investor letter:
“Among our top detractors were Monolithic Power Systems, Inc. (NASDAQ:MPWR), Xylem and Exact Sciences. Monolithic Power Systems designs analog power management chips for a wide variety of industrial and consumer devices. Shares declined after the company reported strong growth in its data center segment that trailed investors’ lofty expectations, which had driven the stock up YTD. Also, while the segment is expected to grow in 2025, the company will face some temporary headwinds as additional power semiconductor suppliers are expected to be qualified to supply NVIDIA’s GPU needs. While we’re cognizant of this headwind in 2025, we expect it to be manageable, and the company has other meaningful growth drivers in store for the year (particularly in autos). Our valuation discipline had led us to reduce the position earlier in the year, but given a more reasonable starting point in Q4, we decided to add to the position.”
Overall, MPWR ranks 8th on our list of best growth stocks to invest in for the next 10 years. While we acknowledge the potential of MPWR as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MPWR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires
Disclosure: None. This article is originally published at Insider Monkey.
