Are Investors Undervaluing Motorcar Parts of America (MPAA) Right Now?

MPAA

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One stock to keep an eye on is Motorcar Parts of America (MPAA - Free Report) . MPAA is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 8.06, which compares to its industry's average of 11.15. Over the last 12 months, MPAA's Forward P/E has been as high as 11.96 and as low as 4.24, with a median of 6.20.

Finally, we should also recognize that MPAA has a P/CF ratio of 8.60. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. MPAA's P/CF compares to its industry's average P/CF of 8.68. Over the past 52 weeks, MPAA's P/CF has been as high as 17.07 and as low as 3.99, with a median of 8.80.

Value investors will likely look at more than just these metrics, but the above data helps show that Motorcar Parts of America is likely undervalued currently. And when considering the strength of its earnings outlook, MPAA sticks out at as one of the market's strongest value stocks.

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