MOTORCAR PARTS OF AMERICA INC

Auto-aftermarket parts remanufacturer returning to profitability with mid-pack returns and significant customer concentration.

Strengths

• Operating margin improved to 8.3% (76th) with record sales and a swing back to net income ($12.4M from a loss)
• Non-discretionary aftermarket demand and tariff-mitigation/Mexico sourcing support resilience

Risks

• Severe customer concentration (top 3 = 85%, largest = 42%) pressuring margins and terms
• Thin liquidity (quick 0.51/17th, cash $17M) and only mid-pack returns (ROE 4.7%, ROA 1.2%)

Notable findings

• Exec changeRecent 8-K item 5.02 8-K ↗
• Customer concentration~85% of revenue from one customer/distributor — Sales to our three largest customers in the aggregate represented 85%, and sales to our largest customer represented 42% of our net sales during fiscal 2026
• China exposureAdditionally, such conflicts may result in the imposition of sanctions, export controls, or other trade restrictions that could affect our ability to source components or conduct business in certain r