Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 4 stocks made the list for top value stocks in the Auto, Truck & Motorcycle Parts industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Auto, Truck & Motorcycle Parts Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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4 Undervalued Auto, Truck & Motorcycle Parts Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 4 undervalued stocks in the Auto, Truck & Motorcycle Parts industry for Tuesday, April 23, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Auto, Truck & Motorcycle Parts industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Commercial Vehicle Group, Inc.’s Value Grade

Value Grade:

Commercial Vehicle Group, Inc. is a global provider of systems, assemblies and components to the global commercial vehicle market, the electric vehicle market, and the industrial automation markets. The Company delivers solutions to complex design, engineering, and manufacturing problems. The Company's segments include Vehicle Solutions, Electrical Systems, Aftermarket & Accessories, and Industrial Automation. The Vehicle Solutions segment designs, manufactures and sells commercial vehicle seats and plastic and trim components. The Electrical Systems segment designs, manufactures and sells cable and harness assemblies for both high and low voltage applications, control boxes, dashboard assemblies and design and engineering for these applications. The Aftermarket & Accessories segment designs, manufactures, and sells seats and components, commercial vehicle accessories, and office seats. The Industrial Automation segment designs, manufactures and sells warehouse automation subsystems.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Commercial Vehicle Group, Inc. has a Value Score of 83, which is considered to be undervalued.

When you look at Commercial Vehicle Group, Inc.’s price-to-sales ratio at 0.21 compared to the industry median at 0.52, this company has a lower price relative to revenue compared to its peers. This could make Commercial Vehicle Group, Inc.’s stock more attractive for value investors.

Commercial Vehicle Group, Inc.’s price-earnings ratio is 4.33 compared to the industry median at 14.14. This means it has a lower share price relative to earnings compared to its peers. This could make Commercial Vehicle Group, Inc. more attractive for value investors.

Now, let’s assess Commercial Vehicle Group, Inc.’s EV/EBITDA ratio, also known as enterprise multiple. At 5.0, when compared to the industry median of 7.3, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Commercial Vehicle Group, Inc.’s shareholder yield is lower than its industry median ratio of 0.00%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Commercial Vehicle Group, Inc.’s price-to-book ratio is lower than its industry median ratio of 1.40. This could make Commercial Vehicle Group, Inc. more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Commercial Vehicle Group, Inc.’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Commercial Vehicle Group, Inc.’s price-to-free-cash-flow ratio is lower than its industry median ratio of 16.16. This could make Commercial Vehicle Group, Inc. more attractive because the lower P/FCF ratio indicates that Commercial Vehicle Group, Inc. is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

OmniTek Engineering Corp’s Value Grade

Value Grade:

Omnitek Engineering Corp. (Omnitek) is a manufacturer in the automotive aftermarket parts industry and the developer of the patented HotWires spark plug wires. Omnitek develops and sells a technology to convert diesel engines to an alternative fuel, new natural gas engines, and complementary products. Omnitek products are available for stationary applications and the global transportation markets, which include light commercial vehicles, minibuses, heavy-duty trucks, municipal buses, as well as rail and marine applications. Its product line includes a conversion kit for converting diesel engines to run on an alternative fuel; new complete natural gas engines; high-pressure natural gas coalescing filter, and natural gas engine components. Its range of products include New Natural Gas Engines, Omnitek DNG Engines, Products for Diesel-to-Natural Gas Engine Conversions, Engine Management System (EMS) and Components, EFI for V-Twin Motorcycles, Small Engines and Hydrogen Engine System.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

OmniTek Engineering Corp has a Value Score of 66, which is considered to be undervalued.

You can read more about OmniTek Engineering Corp’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Superior Industries International Inc’s Value Grade

Value Grade:

Superior Industries International, Inc. is engaged in designing and manufacturing aluminum wheels for sale to original equipment manufacturers (OEMs) in North America and Europe and to the aftermarket in Europe. The Company designs, engineers, and manufactures a wide variety of products utilizing the latest lightweight and finishing technologies. The Company is an aluminum wheel supplier to global OEMs and European aluminum wheel aftermarket manufacturers and suppliers. The Company’s OEM aluminum wheels are primarily sold for factory installation on vehicle models. The Company sells aluminum wheels to the European aftermarket under the brands ATS, RIAL, ALUTEC and ANZIO. The Company manufactures all of its North American products in Mexico for sale in the United States, Canada and Mexico.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Superior Industries International Inc has a Value Score of 92, which is considered to be undervalued.

You can read more about Superior Industries International Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Westport Fuel Systems Inc’s Value Grade

Value Grade:

Westport Fuel Systems Inc. is focused on engineering, manufacturing, and supplying alternative fuel systems and components for transportation applications. Its product offerings sold under a range of established global brands enable the use of a number of alternative fuels in the transportation sector that provide environmental and/or economic advantages as compared to diesel, gasoline, batteries or fuel cell powered vehicles. Its fuel systems and associated components control the pressure and flow of alternative fuels, including liquid petroleum gas, compressed natural gas, liquified natural gas, renewable natural gas or biomethane, and hydrogen. The Company supplies its products in more than 70 countries through a network of distributors, service providers for the aftermarket and directly to original equipment manufacturers and Tier 1 and Tier 2 OEM suppliers. Its products and services are available for passenger car and light-, medium- and heavy-duty truck and off-road applications.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Westport Fuel Systems Inc has a Value Score of 99, which is considered to be undervalued.

Westport Fuel Systems Inc’s price-to-book ratio is higher than its peers. This could make Westport Fuel Systems Inc less attractive for value investors when compared to the industry median at 1.40.

You can read more about Westport Fuel Systems Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Auto, Truck & Motorcycle Parts Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Auto, Truck & Motorcycle Parts stocks as well as other industrys.

Choosing Which of the 4 Best Auto, Truck & Motorcycle Parts Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Commercial Vehicle Group, Inc. stock has a Value Grade of A.
• OmniTek Engineering Corp stock has a Value Grade of B.
• Superior Industries International Inc stock has a Value Grade of A.
• Westport Fuel Systems Inc stock has a Value Grade of A.

Now that you have a bit more background about each of the 4 undervalued stocks in the Auto, Truck & Motorcycle Parts industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Auto, Truck & Motorcycle Parts Stocks

Want to learn more about Auto, Truck & Motorcycle Parts stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 4 Undervalued Auto, Truck & Motorcycle Parts Stocks for Tuesday, April 23
• 5 Undervalued Auto, Truck & Motorcycle Parts Stocks for Monday, April 22
• 4 Undervalued Auto, Truck & Motorcycle Parts Stocks for Friday, April 19
• 3 Undervalued Auto, Truck & Motorcycle Parts Stocks for Thursday, April 18

AAII Disclaimer

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