Is Motorcar Parts of America, Inc. overvalued or undervalued?

As of 11 August 2025, the valuation grade for Motorcar Parts of America, Inc. moved from risky to attractive, indicating a significant improvement in its investment appeal. The company appears to be undervalued, particularly when considering its Price to Book Value of 0.89, EV to EBIT of 5.72, and EV to Sales of 0.48. In comparison to peers, American Axle & Manufacturing Holdings, Inc. has a P/E ratio of 9.51 and an EV to EBITDA of 4.02, while Cooper-Standard Holdings, Inc. shows a P/E of 19.94 and an EV to EBITDA of 7.37, highlighting that Motorcar Parts is trading at lower multiples than some of its competitors.
Additionally, Motorcar Parts has demonstrated strong recent performance, with a year-to-date return of 116.97%, significantly outpacing the S&P 500's return of 12.22% during the same period. This performance reinforces the notion that the stock may be undervalued relative to its current market price and potential for future growth.