Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 7 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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7 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 7 undervalued stocks in the Auto, Truck & Motorcycle Parts industry for Wednesday, September 18, 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.

LCI Industries’s Value Grade

Value Grade:

LCI Industries, through its wholly owned subsidiary, Lippert Components, Inc. (Lippert), supplies, domestically and internationally, a broad array of engineered components for the original equipment manufacturers (OEMs) in the recreation and transportation markets. The Company's segments include OEMs and the Aftermarket. The OEMs segment manufactures and distributes a broad array of engineered components for the OEMs of RVs and adjacent industries, including boats; buses; trailers used to haul boats, livestock, equipment, and other cargo; trucks; trains; manufactured homes; and modular housing. The Aftermarket Segment supplies many of these engineered components to the related aftermarket channels of the recreation and transportation markets, primarily to retail dealers, wholesale distributors, and service centers, as well as direct to retail customers via the Internet. Lippert's products include steel chassis and related components, axles and suspension solutions, and others.

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.

LCI Industries has a Value Score of 61, which is considered to be undervalued.

When you look at LCI Industries’s price-to-sales ratio at 0.81 compared to the industry median at 0.53, this company has a higher price relative to revenue compared to its peers. This could make LCI Industries’s stock less attractive for value investors.

LCI Industries’s price-earnings ratio is 25.40 compared to the industry median at 15.38. This means it has a higher share price relative to earnings compared to its peers. This could make LCI Industries less attractive for value investors.

Now, let’s assess LCI Industries’s EV/EBITDA ratio, also known as enterprise multiple. At 10.2, when compared to the industry median of 6.2, the company may be considered overvalued 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. LCI Industries’s shareholder yield is higher 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. LCI Industries’s price-to-book ratio is higher than its industry median ratio of 1.22. This could make LCI Industries less attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at LCI Industries’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. LCI Industries’s price-to-free-cash-flow ratio is lower than its industry median ratio of 12.66. This could make LCI Industries more attractive because the lower P/FCF ratio indicates that LCI Industries 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.

Miller Industries Inc’s Value Grade

Value Grade:

Miller Industries, Inc. is a manufacturer of towing and recovery equipment. The Company designs and manufactures bodies of car carriers and wreckers, which are installed on chassis manufactured by third parties, and sold to its customers. Its products are marketed and sold through a network of distributors that serve all 50 states, Canada, Mexico, and other foreign markets, and through prime contractors to governmental entities. In addition to selling its products, its independent distributors provide end-users with parts and service. Its product line includes car carriers, wreckers, and transport trailers. Car carriers are specialized flat-bed vehicles with hydraulic tilt mechanisms that enable a towing operator to drive or winch a vehicle onto the bed for transport. Its multi-vehicle transport trailers are specialized auto transport trailers with upper and lower decks and hydraulic ramps for loading vehicles. Its brands include Century, Vulcan, Chevron, Holmes, and Challenger.

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.

Miller Industries Inc has a Value Score of 85, which is considered to be undervalued.

Miller Industries Inc’s price-earnings ratio is 9.5 compared to the industry median at 15.4. This means that it has a lower price relative to its earnings compared to its peers. This makes Miller Industries Inc more attractive for value investors.

Miller Industries Inc’s price-to-book ratio is lower than its peers. This could make Miller Industries Inc more attractive for value investors when compared to the industry median at 1.22.

You can read more about Miller Industries 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.

Motorcar Parts of America Inc’s Value Grade

Value Grade:

Motorcar Parts of America, Inc. is a supplier of automotive aftermarket non-discretionary replacement parts and test solutions and diagnostic equipment. Its Hard Parts segment includes light duty rotating electric products, such as alternators and starters, wheel hub products, brake-related products, including brake calipers, brake boosters, brake rotors, brake pads and brake master cylinders, and turbochargers. The Test Solutions and Diagnostic Equipment segment includes applications for combustion engine vehicles, including bench-top testers for alternators and starters, equipment for the pre- and post-production of electric vehicles, and software emulation of power system applications for the electrification of all forms of transportation (including automobiles, trucks, and electric vehicle charging stations). Its Heavy Duty segment includes non-discretionary automotive aftermarket replacement hard parts for heavy-duty truck, industrial, marine, and agricultural 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.

Motorcar Parts of America Inc has a Value Score of 96, which is considered to be undervalued.

Motorcar Parts of America Inc’s price-to-book ratio is higher than its peers. This could make Motorcar Parts of America Inc less attractive for value investors when compared to the industry median at 1.22.

You can read more about Motorcar Parts of America 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.

Tytan Cybernetics Inc’s Value Grade

Value Grade:

Tytan Cybernetics, Inc., formerly Video River Networks, Inc., is a holding company for electric vehicle technology, financial technology, artificial intelligence, robotics, drones and distressed assets. The Company is engaged in expanding its technology portfolio, which includes electric vehicles, artificial intelligence, machine learning and robotics (EV-AI-ML-R), with businesses and operations in North America and Asia. The Company is also focused on business opportunities within financial technology, artificial intelligence, health, sports and entertainment industries.

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.

Tytan Cybernetics Inc has a Value Score of 97, which is considered to be undervalued.

Tytan Cybernetics Inc’s price-earnings ratio is 0.4 compared to the industry median at 15.4. This means that it has a lower price relative to its earnings compared to its peers. This makes Tytan Cybernetics Inc more attractive for value investors.

Tytan Cybernetics Inc’s price-to-book ratio is higher than its peers. This could make Tytan Cybernetics Inc less attractive for value investors when compared to the industry median at 1.22.

You can read more about Tytan Cybernetics 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.

Phinia Inc’s Value Grade

Value Grade:

PHINIA Inc. is an independent solutions and components provider. The Company develops, designs and manufactures integrated components and systems. The Company provides fuel systems, electrical systems and aftermarket products. Its segments include Fuel Systems and Aftermarket. Fuel Systems segment provides advanced fuel injection systems, fuel delivery modules, canisters, sensors, electronic control modules and associated software. Its highly engineered fuel injection systems portfolio includes pumps, injectors, fuel rail assemblies, engine control modules, and complete systems, including software and calibration services, that reduce emissions and improve fuel economy for traditional and hybrid applications. Aftermarket segment sells products to independent aftermarket customers and original equipment service customers. Aftermarket segment also includes sales of starters and alternators to original equipment manufacturers. Its brand portfolio includes DELPHI, DELCO REMY and HARTRIDGE.

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.

Phinia Inc has a Value Score of 82, which is considered to be undervalued.

Phinia Inc’s price-earnings ratio is 29.8 compared to the industry median at 15.4. This means that it has a higher price relative to its earnings compared to its peers. This makes Phinia Inc less attractive for value investors.

Phinia Inc’s price-to-book ratio is lower than its peers. This could make Phinia Inc fairly attractive for value investors when compared to the industry median at 1.22.

You can read more about Phinia 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.

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 90, 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.

Visteon Corp’s Value Grade

Value Grade:

Visteon Corporation is a global automotive technology company serving the mobility industry. The Company's platforms leverage hardware and software solutions that enable the digital, electric, and autonomous evolution of the Company's global automotive customers, including BMW, Ford, Geely, General Motors, Honda, Jaguar/Land Rover, Mahindra, Mazda, Mercedes-Benz, Mitsubishi, Nissan, Renault, Stellantis, Tata, Toyota, and Volkswagen. The Company operates through the Electronics segment, which provides vehicle cockpit electronics products to customers, including digital instrument clusters, domain controllers with integrated advanced driver assistance systems (ADAS) displays, Android-based infotainment systems, and battery management systems. The Company designs and manufactures automotive electronics and connected car solutions, such as instrument clusters, information displays, infotainment, battery management systems, high-voltage power electronics, telematics solutions and others.

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.

Visteon Corp has a Value Score of 84, which is considered to be undervalued.

Visteon Corp’s price-earnings ratio is 4.8 compared to the industry median at 15.4. This means that it has a lower price relative to its earnings compared to its peers. This makes Visteon Corp more attractive for value investors.

Visteon Corp’s price-to-book ratio is lower than its peers. This could make Visteon Corp more attractive for value investors when compared to the industry median at 1.22.

You can read more about Visteon 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.

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 7 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.

• LCI Industries stock has a Value Grade of B.
• Miller Industries Inc stock has a Value Grade of A.
• Motorcar Parts of America Inc stock has a Value Grade of A.
• Tytan Cybernetics Inc stock has a Value Grade of A.
• Phinia Inc stock has a Value Grade of A.
• Superior Industries International Inc stock has a Value Grade of A.
• Visteon Corp stock has a Value Grade of A.

Now that you have a bit more background about each of the 7 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.

• 7 Undervalued Auto, Truck & Motorcycle Parts Stocks for Wednesday, September 18
• 7 Undervalued Auto, Truck & Motorcycle Parts Stocks for Tuesday, September 17
• Why Adient PLC’s (ADNT) Stock Is Up 5.87%
• Why Phinia Inc’s (PHIN) Stock Is Up 4.98%

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