MPS(US:MPWR) ZACKS·2025-12-30 18:00Core Viewpoint - Monolithic Power (MPWR) has been upgraded to a Zacks Rank 2 (Buy), reflecting an upward trend in earnings estimates, which significantly influences stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the correlation between changes in earnings estimates and near-term stock price movements, making it a valuable tool for investors [2][3]. - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to price movements based on their buying or selling actions [3]. Business Improvement Indicators - The increase in earnings estimates and the Zacks rating upgrade suggest an improvement in Monolithic's underlying business, which could lead to higher stock prices as investors respond positively [4]. Importance of Earnings Estimate Revisions - Research indicates a strong correlation between earnings estimate revisions and stock movements, highlighting the importance of tracking these revisions for investment decisions [5]. - The Zacks Rank system effectively leverages earnings estimate revisions to classify stocks, providing a structured approach to investment [6]. Current Earnings Estimates for Monolithic - Monolithic is projected to earn $17.71 per share for the fiscal year ending December 2025, with a 1.4% increase in the Zacks Consensus Estimate over the past three months [7]. Zacks Rating System Overview - The Zacks rating system maintains a balanced distribution of ratings, with only the top 20% of stocks receiving a "Strong Buy" or "Buy" rating, indicating superior earnings estimate revisions [8][9]. - Monolithic's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [9].