Motorcar Parts of AmericaMPAA +3.95%70 WACC % is 15.39% as of Jun. 27, 2026, which is 23% above its 10-year median of 12.48. GuruFocus rates MPAA with a GF Score™ of 70/100 and a GF Value™ of $9.67 (Significantly Overvalued). The stock has 3 warning signs investors should review. Among 1,346 Vehicles & Parts companies, Motorcar Parts of America ranks worse than 93.09% on this metric.
As of today (2026-06-27), Motorcar Parts of America's weighted average cost of capital is 15.39%%. Motorcar Parts of America's ROIC % is 4.65% (calculated using TTM income statement data).
Motorcar Parts of America earns returns that do not match up to its cost of capital. It will destroy value as it grows.
For a comprehensive WACC calculation, please access the WACC Calculator.
Motorcar Parts of America (NAS:MPAA) WACC % Explanation
Because it costs money to raise capital. A firm that generates higher ROIC % than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Motorcar Parts of America's weighted average cost of capital is 15.39%%. Motorcar Parts of America's ROIC % is 4.65% (calculated using TTM income statement data).
Motorcar Parts of America earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year quarterly average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together.
For companies that report quarterly, GuruFocus combines all of the most recent year's quarterly debt data from the beginning of the year to the year-end and calculates the average.
For companies that report semi-annually, GuruFocus combines all of the most recent year's semi-annual debt data from the start of the year to the year-end and calculates the average.
For companies that report annually, GuruFocus combines the beginning and ending annual debt data from the most recent year and then calculates the average.
2. The WACC formula discussed above does not include Preferred Stock. Please adjust if preferred stock is considered.
3. (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
4. GuruFocus uses the latest TTM Interest Expense divided by the latest one-year quarterly average debt to get the simplified cost of debt.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Auto Parts subindustry, Motorcar Parts of America's WACC %, along with its competitors' market caps and WACC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Motorcar Parts of America WACC % vs Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Motorcar Parts of America's WACC % distribution charts can be found below:
* The bar in red indicates where Motorcar Parts of America's WACC % falls into.
The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets. The WACC is commonly referred to as the firm's cost of capital. Generally speaking, a company's assets are financed by debt and equity. WACC is the average of the costs of these sources of financing, each of which is weighted by its respective use in the given situation. By taking a weighted average, we can see how much interest the company has to pay for every dollar it finances.
WACC
=
E
/
(E + D)
*
Cost of Equity
+
D
/
(E + D)
*
Cost of Debt
*
(1 - Tax Rate)
1. Weights:
Generally speaking, a company's assets are financed by debt and equity. We need to calculate the weight of equity and the weight of debt.
The market value of equity (E) is also called "Market Cap". As of today, Motorcar Parts of America's market capitalization (E) is $293.524 Mil.
The market value of debt is typically difficult to calculate, therefore, GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding the latest one-year quarterly average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Mar. 2026, Motorcar Parts of America's latest one-year quarterly average Book Value of Debt (D) is $196.942 Mil.
a) weight of equity = E / (E + D) = 293.524 / (293.524 + 196.942) = 0.5985
b) weight of debt = D / (E + D) = 196.942 / (293.524 + 196.942) = 0.4015
2. Cost of Equity:
GuruFocus uses Capital Asset Pricing Model (CAPM) to calculate the required rate of return. The formula is:
Cost of Equity = Risk-Free Rate of Return + Beta of Asset * (Expected Return of the Market - Risk-Free Rate of Return)
a) GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate. It is updated daily. The current risk-free rate is 4.376%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default.
b) Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. Motorcar Parts of America's beta is 1.9364.
c) (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
Cost of Equity = 4.376% + 1.9364 * 6% = 15.9944%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year quarterly average debt to get the simplified cost of debt.
As of Mar. 2026, Motorcar Parts of America's interest expense (positive number) was $46.696 Mil. Its total Book Value of Debt (D) is $196.942 Mil.
Cost of Debt = 46.696 / 196.942 = 23.7105%.
4. Multiply by one minus TTM Tax Rate:
GuruFocus uses the most recent TTM Tax Expense divided by the most recent TTM Pre-Tax Income to calculate the tax rate. The calculated TTM tax rate is limited to between 0% and 100%. If the calculated tax rate is higher than 100%, it is set to 100%. If the calculated tax rate is less than 0%, it is set to 0%.
The latest calculated TTM Tax Rate = 7.875 / 20.269 = 38.85%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Motorcar Parts of America (MPAA) has a WACC % of 15.39% as of Jun. 27, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Motorcar Parts of America and its competitors. This is 23% above median its historical median of 12.48. Over the past decade, Motorcar Parts of America's WACC % has ranged from 8.65 to 19.08. According to the industry distribution chart, Motorcar Parts of America ranks #1253 out of 1346 companies in the Vehicles & Parts industry, placing it in the top 93.1%.
Is Motorcar Parts of America's WACC % too high?
Motorcar Parts of America's current WACC % of 15.39% is 23% above median its 10-year median of 12.48. Over the past 10 years, this metric has ranged from a low of 8.65 to a high of 19.08. The Vehicles & Parts industry median WACC % is 8.59. Motorcar Parts of America's value of 15.39% is 79.3% above this industry median. Based on the distribution chart, Motorcar Parts of America ranks #1253 out of 1346 companies in the Vehicles & Parts industry, which is in the bottom quartile relative to peers. Overall, Motorcar Parts of America has a GF Score™ of 70/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Motorcar Parts of America's WACC % compare to SRI and CVGI?
According to the Vehicles & Parts industry distribution chart, Motorcar Parts of America ranks #1253 out of 1346 companies for WACC %. This places Motorcar Parts of America in the lower half of its industry. The industry median WACC % is 8.59. Motorcar Parts of America's value of 15.39% is 79.3% above this benchmark. Historically, Motorcar Parts of America's own WACC % has ranged from 8.65 to 19.08 over the past decade. While the company's 10-year median is 12.48 vs. the industry median of 8.59, Motorcar Parts of America has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good WACC % for a Vehicles & Parts company?
The median WACC % among Vehicles & Parts companies is 8.59, based on 1,346 companies in the industry. Companies in the top quartile (top 25%) have a WACC % significantly above this median, while those in the bottom quartile fall well below. However, WACC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Motorcar Parts of America's current WACC % of 15.39% is 79.3% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high WACC % mean?
A high WACC % can signal that a stock is expensive relative to its fundamentals. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Motorcar Parts of America and its competitors. For the Vehicles & Parts industry, the median WACC % is 8.59 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Motorcar Parts of America's current WACC % is 15.39%, which is 23% above median its own 10-year median of 12.48. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Motorcar Parts of America stock overvalued right now?
Based on GuruFocus' analysis, Motorcar Parts of America (MPAA) is currently considered Significantly Overvalued. The stock's GF Value™ is $9.67, compared to a current price of $15.51 — trading 60.4% above its estimated fair value. The current WACC % is 15.39%, which is 23% above median its 10-year median of 12.48 and 79.3% above the Vehicles & Parts industry median of 8.59. Motorcar Parts of America's overall GF Score™ is 70/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is WACC % calculated?
WACC % is calculated from a company's financial statements. For Motorcar Parts of America (MPAA), the current WACC % is 15.39% as of Jun. 27, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Motorcar Parts of America (MPAA) Overvalued in 2026?
Based on GuruFocus' analysis, Motorcar Parts of America stock appears to be overvalued.
The current stock price of $15.51 is trading 60.4% above its estimated GF Value™ of $9.67.
GuruFocus considers Motorcar Parts of America to be Significantly Overvalued.
Key valuation signals for MPAA:
WACC %: 15.39% (23% above median its 10-year median of 12.48)
GF Value™: $9.67 vs. price of $15.51 (60.4% above fair value)
Industry Position: 79.3% above the Vehicles & Parts median (#1253 of 1346)
No single metric tells the full story. See the MPAA stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Motorcar Parts of America Inc is a supplier of automotive aftermarket non-discretionary replacement parts, test solutions, and diagnostic equipment. Its replacement parts are mainly sold to automotive retail chain stores, warehouse distributors across North America, and automobile manufacturers for aftermarket and warranty replacement programs. The Company's test solutions and diagnostic equipment serve the automotive component and powertrain testing market. Its product portfolio includes rotating electrical products such as alternators and starters; brake-related products including brake calipers, brake rotors, brake pads, brake master cylinders, and wheel hub assemblies and bearings; and other products. Its segments are Hard Parts, Test Solutions and Diagnostic Equipment, and Heavy Duty.
70GF Score
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