BORGWARNER INC (BWA) Stock Fundamental Analysis
NYSE:BWA - New York Stock Exchange, Inc. - US0997241064 - Common Stock - Currency: USD
Overall BWA gets a fundamental rating of 5 out of 10. We evaluated BWA against 81 industry peers in the Automobile Components industry. BWA has an average financial health and profitability rating. BWA has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
BWA had positive earnings in the past year.
BWA had a positive operating cash flow in the past year.
In the past 5 years BWA has always been profitable.
BWA had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
BWA has a worse Return On Assets (2.09%) than 66.67% of its industry peers.
BWA has a Return On Equity of 5.05%. This is in the lower half of the industry: BWA underperforms 65.43% of its industry peers.
BWA's Return On Invested Capital of 9.30% is amongst the best of the industry. BWA outperforms 88.89% of its industry peers.
BWA had an Average Return On Invested Capital over the past 3 years of 8.99%. This is in line with the industry average of 9.05%.
The 3 year average ROIC (8.99%) for BWA is below the current ROIC(9.30%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.09% | ||
| ROE | 5.05% | ||
| ROIC | 9.3% |
ROA(3y)4.1%
ROA(5y)3.73%
ROE(3y)9.97%
ROE(5y)9.08%
ROIC(3y)8.99%
ROIC(5y)8.17%
1.3 Margins
With a Profit Margin value of 2.06%, BWA is not doing good in the industry: 67.90% of the companies in the same industry are doing better.
In the last couple of years the Profit Margin of BWA has declined.
BWA has a Operating Margin (9.42%) which is in line with its industry peers.
BWA's Operating Margin has declined in the last couple of years.
The Gross Margin of BWA (18.91%) is worse than 76.54% of its industry peers.
In the last couple of years the Gross Margin of BWA has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.42% | ||
| PM (TTM) | 2.06% | ||
| GM | 18.91% |
OM growth 3Y-0.75%
OM growth 5Y-5.01%
PM growth 3Y-12.8%
PM growth 5Y-20.03%
GM growth 3Y-0.77%
GM growth 5Y-1.87%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so BWA is still creating some value.
Compared to 1 year ago, BWA has less shares outstanding
BWA has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, BWA has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.80 indicates that BWA is not a great score, but indicates only limited risk for bankruptcy at the moment.
BWA has a Altman-Z score of 2.80. This is in the better half of the industry: BWA outperforms 64.20% of its industry peers.
The Debt to FCF ratio of BWA is 4.01, which is a neutral value as it means it would take BWA, 4.01 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of BWA (4.01) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.67 indicates that BWA is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.67, BWA is not doing good in the industry: 74.07% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 4.01 | ||
| Altman-Z | 2.8 |
ROIC/WACC1.05
WACC8.82%
2.3 Liquidity
A Current Ratio of 1.97 indicates that BWA should not have too much problems paying its short term obligations.
BWA has a better Current ratio (1.97) than 74.07% of its industry peers.
BWA has a Quick Ratio of 1.60. This is a normal value and indicates that BWA is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.60, BWA belongs to the top of the industry, outperforming 85.19% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.97 | ||
| Quick Ratio | 1.6 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.29% over the past year.
BWA shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 0.90% yearly.
Looking at the last year, BWA shows a small growth in Revenue. The Revenue has grown by 2.89% in the last year.
The Revenue has been growing slightly by 6.74% on average over the past years.
EPS 1Y (TTM)3.29%
EPS 3Y1.35%
EPS 5Y0.9%
EPS Q2Q%7.77%
Revenue 1Y (TTM)2.89%
Revenue growth 3Y-1.72%
Revenue growth 5Y6.74%
Sales Q2Q%-2.23%
3.2 Future
Based on estimates for the next years, BWA will show a small growth in Earnings Per Share. The EPS will grow by 5.67% on average per year.
Based on estimates for the next years, BWA will show a small growth in Revenue. The Revenue will grow by 3.02% on average per year.
EPS Next Y-0.31%
EPS Next 2Y4.14%
EPS Next 3Y5.75%
EPS Next 5Y5.67%
Revenue Next Year-1.56%
Revenue Next 2Y0.68%
Revenue Next 3Y2%
Revenue Next 5Y3.02%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 7.45, which indicates a rather cheap valuation of BWA.
BWA's Price/Earnings ratio is rather cheap when compared to the industry. BWA is cheaper than 81.48% of the companies in the same industry.
BWA's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.35.
BWA is valuated cheaply with a Price/Forward Earnings ratio of 7.00.
Compared to the rest of the industry, the Price/Forward Earnings ratio of BWA indicates a somewhat cheap valuation: BWA is cheaper than 71.60% of the companies listed in the same industry.
BWA's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.19.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.45 | ||
| Fwd PE | 7 |
4.2 Price Multiples
65.43% of the companies in the same industry are more expensive than BWA, based on the Enterprise Value to EBITDA ratio.
70.37% of the companies in the same industry are more expensive than BWA, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.49 | ||
| EV/EBITDA | 4.66 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)8.25
EPS Next 2Y4.14%
EPS Next 3Y5.75%
5. Dividend
5.1 Amount
BWA has a Yearly Dividend Yield of 1.32%.
BWA's Dividend Yield is slightly below the industry average, which is at 4.37.
Compared to an average S&P500 Dividend Yield of 2.42, BWA's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.32% |
5.2 History
The dividend of BWA decreases each year by -8.36%.
BWA has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-8.36%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
BWA pays out 33.56% of its income as dividend. This is a sustainable payout ratio.
DP33.56%
EPS Next 2Y4.14%
EPS Next 3Y5.75%
32.8
-0.5 (-1.5%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupAutomobiles & Components
GICS IndustryAutomobile Components
Earnings (Last)
Earnings (Next)
Inst Owners104.28%
Inst Owner Change1.31%
Ins Owners1.06%
Ins Owner Change15.35%
Market Cap7.21B
Analysts75.45
Price Target38.17 (16.37%)
Short Float %4.5%
Short Ratio3.79
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.32% |
Yearly Dividend0.44
Dividend Growth(5Y)-8.36%
DP33.56%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.61%
Min EPS beat(2)4.66%
Max EPS beat(2)12.56%
EPS beat(4)4
Avg EPS beat(4)12.62%
Min EPS beat(4)4.66%
Max EPS beat(4)16.74%
EPS beat(8)7
Avg EPS beat(8)11.16%
EPS beat(12)10
Avg EPS beat(12)11.87%
EPS beat(16)14
Avg EPS beat(16)15.26%
Revenue beat(2)1
Avg Revenue beat(2)0.5%
Min Revenue beat(2)-1.29%
Max Revenue beat(2)2.3%
Revenue beat(4)1
Avg Revenue beat(4)-1.35%
Min Revenue beat(4)-3.74%
Max Revenue beat(4)2.3%
Revenue beat(8)3
Avg Revenue beat(8)-0.09%
Revenue beat(12)4
Avg Revenue beat(12)-4.75%
Revenue beat(16)7
Avg Revenue beat(16)-2.73%
PT rev (1m)7.1%
PT rev (3m)-1.88%
EPS NQ rev (1m)0.07%
EPS NQ rev (3m)-5.51%
EPS NY rev (1m)-0.98%
EPS NY rev (3m)-0.47%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)1.1%
Revenue NY rev (1m)-0.16%
Revenue NY rev (3m)0.62%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.45 | ||
| Fwd PE | 7 | ||
| P/S | 0.51 | ||
| P/FCF | 7.49 | ||
| P/OCF | 4.61 | ||
| P/B | 1.26 | ||
| P/tB | 2.49 | ||
| EV/EBITDA | 4.66 |
EPS(TTM)4.4
EY13.41%
EPS(NY)4.69
Fwd EY14.28%
FCF(TTM)4.38
FCFY13.35%
OCF(TTM)7.11
OCFY21.67%
SpS63.74
BVpS26.03
TBVpS13.19
PEG (NY)N/A
PEG (5Y)8.25
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.09% | ||
| ROE | 5.05% | ||
| ROCE | 12.44% | ||
| ROIC | 9.3% | ||
| ROICexc | 11.07% | ||
| ROICexgc | 16.17% | ||
| OM | 9.42% | ||
| PM (TTM) | 2.06% | ||
| GM | 18.91% | ||
| FCFM | 6.87% |
ROA(3y)4.1%
ROA(5y)3.73%
ROE(3y)9.97%
ROE(5y)9.08%
ROIC(3y)8.99%
ROIC(5y)8.17%
ROICexc(3y)11.03%
ROICexc(5y)10.47%
ROICexgc(3y)18.11%
ROICexgc(5y)17.92%
ROCE(3y)12.03%
ROCE(5y)10.93%
ROICexcg growth 3Y-6.79%
ROICexcg growth 5Y-7.32%
ROICexc growth 3Y0.73%
ROICexc growth 5Y-5.84%
OM growth 3Y-0.75%
OM growth 5Y-5.01%
PM growth 3Y-12.8%
PM growth 5Y-20.03%
GM growth 3Y-0.77%
GM growth 5Y-1.87%
F-Score7
Asset Turnover1.01
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 4.01 | ||
| Debt/EBITDA | 1.93 | ||
| Cap/Depr | 88.5% | ||
| Cap/Sales | 4.28% | ||
| Interest Coverage | 9.49 | ||
| Cash Conversion | 78.22% | ||
| Profit Quality | 332.87% | ||
| Current Ratio | 1.97 | ||
| Quick Ratio | 1.6 | ||
| Altman-Z | 2.8 |
F-Score7
WACC8.82%
ROIC/WACC1.05
Cap/Depr(3y)114.31%
Cap/Depr(5y)102.13%
Cap/Sales(3y)5.07%
Cap/Sales(5y)4.85%
Profit Quality(3y)122.63%
Profit Quality(5y)126.26%
High Growth Momentum
Growth
EPS 1Y (TTM)3.29%
EPS 3Y1.35%
EPS 5Y0.9%
EPS Q2Q%7.77%
EPS Next Y-0.31%
EPS Next 2Y4.14%
EPS Next 3Y5.75%
EPS Next 5Y5.67%
Revenue 1Y (TTM)2.89%
Revenue growth 3Y-1.72%
Revenue growth 5Y6.74%
Sales Q2Q%-2.23%
Revenue Next Year-1.56%
Revenue Next 2Y0.68%
Revenue Next 3Y2%
Revenue Next 5Y3.02%
EBIT growth 1Y9.01%
EBIT growth 3Y-2.46%
EBIT growth 5Y1.39%
EBIT Next Year41.91%
EBIT Next 3Y15.58%
EBIT Next 5Y9.26%
FCF growth 1Y55.92%
FCF growth 3Y2.2%
FCF growth 5Y5.26%
OCF growth 1Y8.4%
OCF growth 3Y1.16%
OCF growth 5Y6.05%