Rounding out my top picks in this leading industry is Zacks Rank #1 (Strong Buy) Motorcar Parts of America (MPAA). MPAA specializes in manufacturing alternators and starters for both domestic and imported autos. Earnings estimates have been rising since last summer, helping the stock turnover from a disappointing 2012. This year earnings are expected to come in at $1.37 compared to an 85 cent loss per share last year. The growth has been so good recently that MPAA has surprised to the upside by no less than 33% over the last 3 quarters. Hopefully the trend continues and we see another beat this quarter.
The technical picture for MPAA is the best of the bunch. A steady uptrend, finding strength at the 25×5 each time, almost perfectly aligned with a stochastic buy signal from oversold territory every time. The most recent retest of the uptrend has taken place in the last few days, with the stock dipping just below $23 before beginning this latest run. Right now you have the stock trading just above the 25×5 and just below resistance at $27. This trading set up looks great right now and a tight stop could easily be placed just below $24 with a target at $30, close to 20% above where we sit now for a very attractive risk versus reward.