Motorcar Parts of America, Inc. (MPAA)
NASDAQConsumer DiscretionaryAuto - PartsSnapshot 2026-09-04
$12.08+2.46%
Close 2026-09-04 · 1-day change
NASDAQConsumer DiscretionaryAuto - PartsSnapshot 2026-09-04
Broken: Primary pillar broken — Operating margin near 15.5% in fiscal 2027: FY27 operating margin guidance 15.5% vs 15.5% target; Q1 FY27 actual 2.1% vs 12.3% trip.
Motorcar Parts of America grows revenue about 5% yearly, hitting $790M next year. Profit margin is expected near 15.5% next fiscal year. Operating income improved from -$6.5M to $21.1M in one year. The company shows steady progress and market confidence.
Revenue growth could slow below 5%. Profit margins might fall under 12%. Operating income gains may stall or reverse. The company faces sector headwinds and elevated risk.
The price is about 3% above our fair value near $14. Analysts expect roughly 5% revenue growth. Our view aligns with this but sees risk in margin and income execution.
Breaks if: Operating income falls below $15M in next four quarters
Breaks if: Operating margin falls below 12.3% in fiscal 2027
Breaks if: Revenue falls below $750M in fiscal 2027
Management is emphasizing the importance of increasing revenue across its operations.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a turnaround opportunity in the Consumer Discretionary sector. The current thesis state is weakened due to recent earnings misses and a shift in confidence from high to medium.
The market currently prices MPAA as cheap compared to its peers, with an expectations gap indicating that investors are anticipating lower performance. The valuation reflects a premium compared to industry standards, suggesting that some positive outcomes may already be factored in.
Management is focused on revenue growth, improving operating income, and enhancing cash flow, with recent financial performance being neutral. However, there is a high near-term risk of missing earnings expectations, which could impact future results.
The thesis hinges on whether MPAA can maintain its guidance and manage external pressures like inflation and sector performance. Positive momentum from industry peers could provide support, while any guidance cuts or economic headwinds could lead to unfavorable outcomes.
In the next 1 to 3 years, MPAA's outlook will depend on its ability to navigate risks and deliver on growth commitments. Not investment advice.
The most important moves since the prior daily snapshot.
Yes, our read has weakened. The reason to own MPAA has diminished significantly. Recent financial performance dropped from the top half to the bottom half of its industry. Additionally, the company missed earnings expectations in Q1 FY2027, which adds to the concerns.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.