Is Monolithic Power Systems, Inc. overvalued or undervalued?

As of 1 August 2025, the valuation grade for Monolithic Power Systems, Inc. has moved from very attractive to attractive, indicating a slight adjustment in its perceived value. The company appears to be overvalued based on key ratios, including a P/E ratio of 18, an EV to EBITDA of 48.87, and a Price to Book Value of 10.07. In comparison to peers, Microchip Technology, Inc. has a much riskier valuation with a P/E ratio of -724.63, while ON Semiconductor Corp. is considered expensive with a P/E of 25.65.
Monolithic Power Systems has delivered strong returns, outperforming the S&P 500 with a year-to-date return of 55.11% compared to the index's 12.22%. However, the overall valuation metrics suggest that the stock is currently overvalued relative to its peers and industry standards.