Welcome!

News Feed Item

Zacks Investment Ideas feature highlights: Douglas Dynamics, Dorman Products and Motorcar Parts of America

CHICAGO, March 21, 2014 /PRNewswire/ -- Today, Zacks Investment Ideas feature highlights Features: Douglas Dynamics (NYSE:PLOW-Free Report), Dorman Products (Nasdaq:DORM-Free Report) and Motorcar Parts of America (Nasdaq:MPAA-Free Report).

Zacks Investment Research, Inc., www.zacks.com.

3 Auto Parts Stocks for a High-Performance Portfolio

Every year right about this time I get the itch. For most people that live in the Midwest it's the itch to get outside and runaround. It's the urge to shake off that cabin fever that has plagued you for the last four or five months. Maybe that's why Chicago goes nuts and dyes the river green on St. Patty's Day. We've been locked up for so long we just have to get out there and do something crazy. (That river's green most of the year anyway.)

I've got a different brand of crazy. This time of year I open up the pocketbook, and usually the savings account, and spend money on new summer tires, refilling the nitrous bottle, new stereo equipment, basically anything that will upset my girlfriend. As I thumbed through the racing parts catalogue earlier this week it got me thinking. Maybe I'm not the only one who is cracking open these pages looking for parts.

This winter was by any measure one of the worst in recent history. I took a peak at the average snowfall map and laughed. Chicago is supposed to get between 24 and 36 inches of snow on average. Guess where we are as of last week? 79 inches. It is the 3rd highest total snowfall on record.

Even though my car doesn't see the snow, the SUVs and pickups with plows attached sure got a whole lot of work this winter. There must be some publicly traded company that sells parts for trucks that plow and I'm sure they are having a great earnings season. What I found was the Captain Obvious of all stock tickers. Take a guess. You got it, (NYSE:PLOW-Free Report), the ticker for the company Douglas Dynamics.

Year over year 4Q saw a 159% increase in sales, mostly attributable to the increase in snowfall early in the season. After living through what happened in 1Q 2014 I would bet that this quarter sees some impressive numbers as well. And while getting a new plow may not be as exciting as a new set of Mickey Thompson 305 Drag Radials, it is good for Douglas Dynamics.

PLOW is a Zacks Rank #1 (Strong Buy) with two analysts raising current year forecasts based on the strong snowy season. Consensus for the year has risen from 79 cents to 95 cents per share.  Last quarter's earnings surprise of 52% is another big reason for the rank.

PLOW just made a huge run from near $14 through previous resistance at $17, approaching $18.50 before finally beginning to pull back. This increased volatility since July of last year was previously unheard of for Douglas Dynamics. A slow, steady uptrend saw appreciation from $13 to $17 without any real scary pull backs at all. The dip down below the 25 day moving average shifted by 5 days (25x5 SMA) in January lasted less than a month. Currently the stock is still in the middle of an intermediate term uptrend, with the 25x5 below the price and in an upward slope. The extreme overbought stochastics are begging for a further sell off to support. Given the fact that $17 was a level of resistance previously, look for that to be support for PLOW should the stock get back down to that level.

Things have been good across the board for the industry. Right now the AUTO/TRUCK-REPLACEMENT PARTS industry is number one in our Zacks Industry Rank. So perhaps snow plows aren't the only parts getting replaced this winter. Being the gear head that I am, I find myself following the automakers often. One stat that stands out is that the average age of cars on the road today. It's now over 10 years. Eventually this pent up demand from the Great Recession has to find its way out, but until then people would rather fix their old cars than buy new ones. If you're fixing old cars, you need parts. A major supplier of parts to Advance Auto Parts and AutoZone isDorman Products (Nasdaq:DORM-Free Report).

Dorman carries a Zacks Rank #2 (Buy) after three analysts raised current year estimates in the last 30 days. The Dorman story has been slow, steady, consistent earnings growth over the years. A quick look at the price and consensus chart shows the solid growth numbers.

From a technical standpoint, DORM is in a similar position to PLOW. However, DORM is a slower and steady story. A failed sustained breakout of $50 saw the stock price retreat down below $47 before finding enough strength to kick off a rally to a new high at $56. Then there was another small seesaw down below $50 and back up through $56 to new highs at $60. What this stock's history tells me is that support and resistance levels are not firm and are relatively wide zones. It has a cyclical nature and doesn't adhere to strict trend lines but overall has a nice, fluttery, upwards motion. I wouldn't be surprised given the stochastic sell signal from overbought territory earlier this month, if the stock comes back down to test as low as $54 before heading higher.

Rounding out my top picks in this leading industry is Zacks Rank #1 (Strong Buy) Motorcar Parts of America (Nasdaq:MPAA-Free Report). 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 25x5 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 25x5 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.

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros.  In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Click here for your free subscription to Profit from the Pros.

Get the full Report on PLOW – FREE

Get the full Report on DORM – FREE

Get the full Report on MPAA – FREE

Follow us on Twitter:  http://twitter.com/ZacksResearch

Join us on Facebook:  http://www.facebook.com/ZacksInvestmentResearch

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
[email protected]
http://www.zacks.com

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Logo - http://photos.prnewswire.com/prnh/20101027/ZIRLOGO

SOURCE Zacks Investment Research, Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Most technology leaders, contemporary and from the hardware era, are reshaping their businesses to do software in the hope of capturing value in IoT. Although IoT is relatively new in the market, it has already gone through many promotional terms such as IoE, IoX, SDX, Edge/Fog, Mist Compute, etc. Ultimately, irrespective of the name, it is about deriving value from independent software assets participating in an ecosystem as one comprehensive solution.
SYS-CON Events announced today that T-Mobile will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. As America's Un-carrier, T-Mobile US, Inc., is redefining the way consumers and businesses buy wireless services through leading product and service innovation. The Company's advanced nationwide 4G LTE network delivers outstanding wireless experiences to 67.4 million customers who are unwilling to compromise on ...
The 20th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held June 6-8, 2017, at the Javits Center in New York City, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal ...
SYS-CON Events announced today that CollabNet, a global leader in enterprise software development, release automation and DevOps solutions, will be a Bronze Sponsor of SYS-CON's 20th International Cloud Expo®, taking place from June 6-8, 2017, at the Javits Center in New York City, NY. CollabNet offers a broad range of solutions with the mission of helping modern organizations deliver quality software at speed. The company’s latest innovation, the DevOps Lifecycle Manager (DLM), supports Value S...
Cybersecurity is a critical component of software development in many industries including medical devices. However, code is not always written to be robust or secure from the unknown or the unexpected. This gap can make medical devices susceptible to cybersecurity attacks ranging from compromised personal health information to life-sustaining treatment. In his session at @ThingsExpo, Clark Fortney, Software Engineer at Battelle, will discuss how programming oversight using key methods can incre...
SYS-CON Events announced today that Hitachi, the leading provider the Internet of Things and Digital Transformation, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Hitachi Data Systems, a wholly owned subsidiary of Hitachi, Ltd., offers an integrated portfolio of services and solutions that enable digital transformation through enhanced data management, governance, mobility and analytics. We help globa...
Did you know that you can develop for mainframes in Java? Or that the testing and deployment can be automated across mobile to mainframe? In his session at @DevOpsSummit at 20th Cloud Expo, Vaughn Marshall, Sr. Principal Product Owner at CA Technologies, will discuss and demo how increasingly teams are developing with agile methodologies using modern development environments and automating testing and deployments, mobile to mainframe.
The goal of Continuous Testing is to shift testing left to find defects earlier and release software faster. This can be achieved by integrating a set of open source functional and performance testing tools in the early stages of your software delivery lifecycle. There is one process that binds all application delivery stages together into one well-orchestrated machine: Continuous Testing. Continuous Testing is the conveyor belt between the Software Factory and production stages. Artifacts are ...
SYS-CON Events announced today that Juniper Networks (NYSE: JNPR), an industry leader in automated, scalable and secure networks, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Juniper Networks challenges the status quo with products, solutions and services that transform the economics of networking. The company co-innovates with customers and partners to deliver automated, scalable and secure network...
SYS-CON Events announced today that CA Technologies has been named "Platinum Sponsor" of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, New York, and 21st International Cloud Expo, which will take place in November in Silicon Valley, California.
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm. In his Day 3 Keynote at 20th Cloud Expo, Chris Brown, a Solutions Marketing Manager at Nutanix, will explore t...
NHK, Japan Broadcasting, will feature the upcoming @ThingsExpo Silicon Valley in a special 'Internet of Things' and smart technology documentary that will be filmed on the expo floor between November 3 to 5, 2015, in Santa Clara. NHK is the sole public TV network in Japan equivalent to the BBC in the UK and the largest in Asia with many award-winning science and technology programs. Japanese TV is producing a documentary about IoT and Smart technology and will be covering @ThingsExpo Silicon Val...
As DevOps methodologies expand their reach across the enterprise, organizations face the daunting challenge of adapting related cloud strategies to ensure optimal alignment, from managing complexity to ensuring proper governance. How can culture, automation, legacy apps and even budget be reexamined to enable this ongoing shift within the modern software factory?
New competitors, disruptive technologies, and growing expectations are pushing every business to both adopt and deliver new digital services. This ‘Digital Transformation’ demands rapid delivery and continuous iteration of new competitive services via multiple channels, which in turn demands new service delivery techniques – including DevOps. In this power panel at @DevOpsSummit 20th Cloud Expo, moderated by DevOps Conference Co-Chair Andi Mann, panelists will examine how DevOps helps to meet th...
SYS-CON Events announced today that Hitachi Data Systems, a wholly owned subsidiary of Hitachi LTD., will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City. Hitachi Data Systems (HDS) will be featuring the Hitachi Content Platform (HCP) portfolio. This is the industry’s only offering that allows organizations to bring together object storage, file sync and share, cloud storage gateways, and sophisticated search an...