NYSE:BWA

Stock Analysis Report

Executive Summary

BorgWarner Inc. provides solutions for combustion, hybrid, and electric vehicles worldwide.

Snowflake

Fundamentals

Good value with proven track record and pays a dividend.


Similar Companies

Share Price & News

How has BorgWarner's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

10.4%

BWA

8.5%

US Auto Components

2.3%

US Market


1 Year Return

1.1%

BWA

-3.4%

US Auto Components

5.6%

US Market

Return vs Industry: BWA exceeded the US Auto Components industry which returned -3.4% over the past year.

Return vs Market: BWA underperformed the US Market which returned 5.6% over the past year.


Shareholder returns

BWAIndustryMarket
7 Day10.4%8.5%2.3%
30 Day-2.9%-0.6%-1.0%
90 Day-2.6%3.9%-0.7%
1 Year3.0%1.1%-1.9%-3.4%7.9%5.6%
3 Year15.1%9.9%10.1%-1.3%45.6%36.3%
5 Year-26.2%-31.2%20.7%3.9%65.8%47.6%

Price Volatility Vs. Market

How volatile is BorgWarner's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is BorgWarner undervalued compared to its fair value and its price relative to the market?

24.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: BWA ($38.33) is trading below our estimate of fair value ($50.72)

Significantly Undervalued: BWA is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: BWA is good value based on its PE Ratio (10.3x) compared to the Auto Components industry average (16.7x).

PE vs Market: BWA is good value based on its PE Ratio (10.3x) compared to the US market (17.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: BWA is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: BWA is overvalued based on its PB Ratio (1.8x) compared to the US Auto Components industry average (1.2x).


Next Steps

Future Growth

How is BorgWarner forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

12.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: BWA's forecast earnings growth (12.2% per year) is above the savings rate (2.7%).

Earnings vs Market: BWA's earnings (12.2% per year) are forecast to grow slower than the US market (14.5% per year).

High Growth Earnings: BWA's earnings are forecast to grow, but not significantly.

Revenue vs Market: BWA's revenue (6.7% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: BWA's revenue (6.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: BWA's Return on Equity is forecast to be low in 3 years time (17.4%).


Next Steps

Past Performance

How has BorgWarner performed over the past 5 years?

0.1%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: BWA's earnings have grown by 0.1% per year over the past 5 years.

Accelerating Growth: BWA's earnings growth over the past year (42.9%) exceeds its 5-year average (0.1% per year).

Earnings vs Industry: BWA earnings growth over the past year (42.9%) exceeded the Auto Components industry 8.1%.


Return on Equity

High ROE: BWA's Return on Equity (18.1%) is considered low.


Return on Assets

ROA vs Industry: BWA has a higher Return on Assets than the Auto Components industry average last year.


Return on Capital Employed

ROCE Improving: BWA's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is BorgWarner's financial position?


Financial Position Analysis

Short Term Liabilities: BWA's short term assets ($3.8B) exceeds its short term liabilities ($2.3B)

Long Term Liabilities: BWA's short term assets (3.8B) exceeds its long term liabilities (3.4B)


Debt to Equity History and Analysis

Debt Level: BWA's debt to equity ratio (46.6%) is considered high

Reducing Debt: BWA's debt to equity ratio has increased from 32% to 46.6% over the past 5 years.

Debt Coverage: BWA's debt is well covered by operating cash flow (61.4%).

Interest Coverage: BWA's interest payments on its debt are well covered by EBIT (21x coverage).


Balance Sheet

Inventory Level: BWA has a high level of physical assets or inventory.

Debt Coverage by Assets: BWA's debt is covered by short term assets (assets are 1.832850x debt).


Next Steps

Dividend

What is BorgWarner's current dividend yield, its reliability and sustainability?

1.77%

Current Dividend Yield


Dividend Yield vs Market

company1.8%marketbottom25%1.5%markettop25%3.8%industryaverage1.9%forecastin3Years1.9%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: BWA's dividend (1.77%) is higher than the bottom 25% of dividend payers in the US market (1.46%).

High Dividend: BWA's dividend (1.77%) is low compared to the top 25% of dividend payers in the US market (3.76%).

Stable Dividend: BWA's dividend payments have been volatile in the past 10 years.

Growing Dividend: BWA's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (18.4%), BWA's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: BWA's dividends in 3 years are forecast to be well covered by earnings (15.1% payout ratio).


Next Steps

Management

What is the CEO of BorgWarner's salary, the management and board of directors tenure and is there insider trading?

1.2yrs

Average management tenure


CEO

Frédéric Lissalde (51yo)

1.2yrs

Tenure

US$5,008,443

Compensation

Mr. Frédéric B. Lissalde has been President, Chief Executive Officer and Director of BorgWarner Inc. since August 01, 2018. He was Executive Vice President and Chief Operating Officer of BorgWarner Inc. si ...


CEO Compensation Analysis

Compensation vs. Market: Frédéric has recently become CEO, making it difficult to compare their total compensation against companies of similar size in the US market.

Compensation vs Earnings: Frédéric's compensation has increased by more than 20% in the past year.


Management Age and Tenure

1.2yrs

Average Tenure

51.5yo

Average Age

Experienced Management: BWA's management team is not considered experienced ( 1.2 years average tenure), which suggests a new team.


Board Age and Tenure

5.7yrs

Average Tenure

63yo

Average Age

Experienced Board: BWA's board of directors are considered experienced (5.7 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$232,44708 Mar 19
Joel Wiegert
EntityIndividual
Shares6,000
Max PriceUS$38.74
SellUS$100,72027 Feb 19
Thomas McGill
EntityIndividual
Role
Chief Accounting Officer
VP, Controller & Principal Accounting Officer
Shares2,400
Max PriceUS$41.97
SellUS$503,18526 Feb 19
Tonit Calaway
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares12,000
Max PriceUS$41.93
BuyUS$49,92719 Dec 18
Deborah McWhinney
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,421
Max PriceUS$35.14
SellUS$400,01827 Nov 18
Alexis Michas
EntityIndividual
Role
Chairman of the Board
Non-Executive Chairman & Presiding Director
Shares10,003
Max PriceUS$39.99
BuyUS$49,88207 Nov 18
Deborah McWhinney
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,215
Max PriceUS$41.06
SellUS$158,28002 Nov 18
Joel Wiegert
EntityIndividual
Shares4,000
Max PriceUS$39.57
SellUS$302,53401 Nov 18
Thomas Stallkamp
EntityIndividual
Shares7,692
Max PriceUS$39.33
BuyUS$118,59001 Nov 18
Paul Mascarenas
EntityIndividual
Role
Member of the Board of Directors
Director
Shares3,000
Max PriceUS$39.53
SellUS$666,16630 Oct 18
Brady Ericson
EntityIndividual
Shares16,780
Max PriceUS$39.70

Ownership Breakdown


Management Team

  • Jamal Farhat (60yo)

    Chief Information Officer & VP

    • Tenure: 15.2yrs
  • Scott Gallett (53yo)

    Vice President of Marketing

    • Tenure: 11.2yrs
  • Patrick Nolan

    Vice President of Investor Relations

    • Tenure: 2.9yrs
  • Kevin Nowlan (47yo)

    Executive VP & CFO

    • Tenure: 0.5yrs
  • Tonit Calaway (51yo)

    Executive VP

    • Tenure: 1.2yrs
    • Compensation: US$2.46m
  • Frédéric Lissalde (51yo)

    President

    • Tenure: 1.2yrs
    • Compensation: US$5.01m
  • Joseph Fadool (52yo)

    Vice President

    • Tenure: 9.3yrs
    • Compensation: US$2.98m
  • Tom McGill (52yo)

    VP, Controller & Principal Accounting Officer

    • Tenure: 0.5yrs
  • Hakan Yilmaz

    Chief Technology Officer

    • Tenure: 0yrs
  • Felecia Pryor (44yo)

    Executive VP & Chief Human Resources Officer

    • Tenure: 0.5yrs

Board Members

  • Alexis Michas (61yo)

    Non-Executive Chairman & Presiding Director

    • Tenure: 6.5yrs
    • Compensation: US$410.90k
  • Vicki Sato (70yo)

    Director

    • Tenure: 5.7yrs
    • Compensation: US$251.50k
  • Jock McKernan (71yo)

    Director

    • Tenure: 10.3yrs
    • Compensation: US$233.50k
  • Debby McWhinney (63yo)

    Director

    • Tenure: 1.3yrs
    • Compensation: US$42.13k
  • Paul Mascarenas (58yo)

    Director

    • Tenure: 1.3yrs
    • Compensation: US$41.88k
  • Dennis Cuneo (70yo)

    Director

    • Tenure: 10.7yrs
    • Compensation: US$236.50k
  • Jan Carlson (59yo)

    Director

    • Tenure: 9.3yrs
    • Compensation: US$246.50k
  • Frédéric Lissalde (51yo)

    President

    • Tenure: 1.2yrs
    • Compensation: US$5.01m
  • Michael Hanley (63yo)

    Director

    • Tenure: 2.9yrs
    • Compensation: US$256.50k

Company Information

BorgWarner Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: BorgWarner Inc.
  • Ticker: BWA
  • Exchange: NYSE
  • Founded: 1987
  • Industry: Auto Parts and Equipment
  • Sector: Automobiles
  • Market Cap: US$7.916b
  • Shares outstanding: 206.51m
  • Website: https://www.borgwarner.com

Number of Employees


Location

  • BorgWarner Inc.
  • 3850 Hamlin Road
  • Auburn Hills
  • Michigan
  • 48326
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BWANYSE (New York Stock Exchange)YesCommon StockUSUSDAug 1993
BGWDB (Deutsche Boerse AG)YesCommon StockDEEURAug 1993
0HOULSE (London Stock Exchange)YesCommon StockGBUSDAug 1993

Biography

BorgWarner Inc. provides solutions for combustion, hybrid, and electric vehicles worldwide. It operates in two segments, Engine and Drivetrain. The Engine segment develops and manufactures turbochargers; e ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/16 23:32
End of Day Share Price2019/10/16 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.