Motorcar Parts of America rises as Roth Capital says company on ‘solid growth footing’

Motorcar Parts of America Inc (NASDAQ:MPAA) rose Wednesday after Roth Capital Partners said the company remains on a solid footing with the expectation of mid-teens revenue growth as it enters fiscal year 2020.

“MPAA remains on solid growth footing, but we continue to await better margin performance as a driver of improving earnings power,” Roth analyst Matt Koranda said in a research note Tuesday.

Shares of MPAA climbed 2.9% to $20.05 in Wednesday’s Nasdaq trading.

READ: Motorcar Parts of America rallies after reporting 16% increase in quarterly net sales

The firm maintained the company at Neutral with a price target of $21.

For the third quarter ended December 31, the Los Angeles company reported adjusted net income of $6.7 million, or $0.35 per diluted share, on net sales of $124.1 million, which was up from $102.9 million a year earlier.

The average estimate of analysts was for earnings per share of $0.38 on revenue of $115.98 million.

Gross margin for the company narrowed to 17% from 25.3% a year earlier.

The company said in a statement earlier this week that it expected “these margin headwinds” to reverse in the next fiscal year.

Contact Dennis Fitzgerald at [email protected]

Story by ProactiveInvestors