Motorcar Stock Story

MPAA
 Stock
  

USD 15.51  0.03  0.19%   

Today we may see the proof that Foresight Autonomous would recover slower from the current slide as its shares fell 6.49% to Motorcar Parts's 2.95%. As many millenniums are excited about consumer cyclical space, we are going to shadow both, Motorcar Parts and Foresight Autonomous as a potential short-term opportunity. We are going to analyze some of the competitive aspects of both Motorcar and Foresight.
Published over two months ago
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Should you exit your Foresight Autonomous (NASDAQ:FRSX) and Motorcar Parts (NASDAQ:MPAA) positions after a build up?

By analyzing existing basic indicators between Motorcar Parts and Foresight, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Foresight with a short position in Motorcar Parts. Check out our pair correlation module for more information.

Let's begin by analyzing the assets.
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Motorcar Parts has an asset utilization ratio of 918.03 percent. This suggests that the company is making $9.18 for each dollar of assets. An increasing asset utilization means that Motorcar Parts Amer is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two companies, such as Motorcar or Alcoa is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

How important is Motorcar Parts's Liquidity

Motorcar Parts financial leverage refers to using borrowed capital as a funding source to finance Motorcar Parts Amer ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Motorcar Parts financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Motorcar Parts's total debt and its cash.

Correlation Between Motorcar and Alcoa Corp

In general, stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Motorcar Parts together with similar or unrelated positions with a negative correlation. For example, you can also add Alcoa Corp to your portfolio. If Alcoa Corp is not perfectly correlated to Motorcar Parts it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Motorcar Parts for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Please check pair correlation details between MPAA and AA for more information.

Note

Are you currently holding both Motorcar Parts and Alcoa Corp in your portfolio?
Please note if you are using this as a pair-trade strategy between Motorcar Parts and Alcoa Corp, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses.

Exercise or conversion by David Lee of 30900 shares of Motorcar Parts subject to Rule 16b-3

Legal trades by Motorcar Parts insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Motorcar insider trading alert for exercise of stock option by David Lee, CFO, on 12th of August 2022. This event was filed by Motorcar Parts America In with SEC on 2022-08-12. Statement of changes in beneficial ownership - SEC Form 4 [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking down Motorcar Parts Indicators

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Let me now analyze Motorcar Parts revenue. Based on the latest financial disclosure, Motorcar Parts Amer reported 654.52 M of revenue. This is 90.82% lower than that of the Consumer Cyclical sector and 87.11% lower than that of the Auto Parts industry. The revenue for all United States stocks is 93.06% higher than that of Motorcar Parts. As for Foresight Autonomous we see revenue of 120 K, which is 100.0% lower than that of the Auto Parts

Sector
5.1 B
MPAA654.52 Million11.42
Sector5.08 Billion88.58
FRSX120,0000.002093

Another setback for Motorcar Parts investors

Current Kurtosis is up to -0.05. Price may slip again. Motorcar Parts Amer exhibits very low volatility with skewness of -0.1 and kurtosis of -0.05. However, we advise investors to further study Motorcar Parts Amer technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Motorcar Parts' stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Motorcar Parts' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Motorcar Parts Implied Volatility

Motorcar Parts' implied volatility exposes the market's sentiment of Motorcar Parts Amer stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Motorcar Parts' implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Motorcar Parts stock will not fluctuate a lot when Motorcar Parts' options are near their expiration.

The Current Takeaway on Motorcar Parts Investment

Whereas some firms in the auto parts industry are either recovering or due for a correction, Motorcar Parts may not be performing as strong as the other in terms of long-term growth potentials. On the whole, as of the 13th of June 2022, we believe that Motorcar Parts is currently undervalued with very low chance of financial distress in the next two years. Our overall 90 days 'Buy-vs-Sell' recommendation on the company is Hold.

Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Gabriel Shpitalnik do not own shares of Motorcar Parts Amer. Please refer to our Terms of Use for any information regarding our disclosure principles.

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