BORGWARNER INC (BWA) Stock Fundamental Analysis
USA - NYSE:BWA - US0997241064 - Common Stock
42.59 USD
-0.22 (-0.51%)
42.59 USD
0 (0%)
BWA gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 82 industry peers in the Automobile Components industry. BWA scores quite bad on profitability, while its financial health is fine. Not spectacular, but in line with the averages. BWA has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
BWA had positive earnings in the past year.
In the past year BWA had a positive cash flow from operations.
BWA had positive earnings in each of the past 5 years.
In the past 5 years BWA always reported a positive cash flow from operatings.
1.2 Ratios
BWA has a worse Return On Assets (1.46%) than 72.84% of its industry peers.
Looking at the Return On Equity, with a value of 3.55%, BWA is doing worse than 69.14% of the companies in the same industry.
BWA has a better Return On Invested Capital (8.92%) than 90.12% of its industry peers.
The Average Return On Invested Capital over the past 3 years for BWA is in line with the industry average of 8.51%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.46% | ||
| ROE | 3.55% | ||
| ROIC | 8.92% |
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
BWA's Profit Margin of 1.50% is on the low side compared to the rest of the industry. BWA is outperformed by 70.37% of its industry peers.
BWA's Profit Margin has declined in the last couple of years.
BWA has a Operating Margin (9.34%) which is in line with its industry peers.
BWA's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 18.65%, BWA is doing worse than 75.31% of the companies in the same industry.
BWA's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.34% | ||
| PM (TTM) | 1.5% | ||
| GM | 18.65% |
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.
The number of shares outstanding for BWA has been reduced compared to 1 year ago.
BWA has more shares outstanding than it did 5 years ago.
The debt/assets ratio for BWA is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.87 indicates that BWA is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of BWA (2.87) is better than 62.96% of its industry peers.
The Debt to FCF ratio of BWA is 3.33, which is a good value as it means it would take BWA, 3.33 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 3.33, BWA belongs to the best of the industry, outperforming 90.12% of the companies in the same industry.
BWA has a Debt/Equity ratio of 0.66. This is a neutral value indicating BWA is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.66, BWA is doing worse than 76.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | 3.33 | ||
| Altman-Z | 2.87 |
ROIC/WACC1.08
WACC8.28%
2.3 Liquidity
A Current Ratio of 2.02 indicates that BWA has no problem at all paying its short term obligations.
With a decent Current ratio value of 2.02, BWA is doing good in the industry, outperforming 75.31% of the companies in the same industry.
A Quick Ratio of 1.66 indicates that BWA should not have too much problems paying its short term obligations.
BWA has a better Quick ratio (1.66) than 85.19% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.02 | ||
| Quick Ratio | 1.66 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.80% over the past year.
Measured over the past 5 years, BWA shows a small growth in Earnings Per Share. The EPS has been growing by 0.90% on average per year.
Looking at the last year, BWA shows a decrease in Revenue. The Revenue has decreased by -2.10% in the last year.
The Revenue has been growing slightly by 6.74% on average over the past years.
EPS 1Y (TTM)7.8%
EPS 3Y1.35%
EPS 5Y0.9%
EPS Q2Q%1.68%
Revenue 1Y (TTM)-2.1%
Revenue growth 3Y-1.72%
Revenue growth 5Y6.74%
Sales Q2Q%0.97%
3.2 Future
The Earnings Per Share is expected to grow by 6.26% on average over the next years.
The Revenue is expected to grow by 4.17% on average over the next years.
EPS Next Y7.31%
EPS Next 2Y7.2%
EPS Next 3Y7.6%
EPS Next 5Y6.26%
Revenue Next Year1.68%
Revenue Next 2Y2.43%
Revenue Next 3Y2.63%
Revenue Next 5Y4.17%
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
With a Price/Earnings ratio of 9.64, the valuation of BWA can be described as very reasonable.
BWA's Price/Earnings ratio is a bit cheaper when compared to the industry. BWA is cheaper than 77.78% of the companies in the same industry.
When comparing the Price/Earnings ratio of BWA to the average of the S&P500 Index (27.40), we can say BWA is valued rather cheaply.
The Price/Forward Earnings ratio is 8.58, which indicates a very decent valuation of BWA.
Based on the Price/Forward Earnings ratio, BWA is valued a bit cheaper than the industry average as 71.60% of the companies are valued more expensively.
BWA is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.94, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.64 | ||
| Fwd PE | 8.58 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, BWA is valued a bit cheaper than 66.67% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of BWA indicates a rather cheap valuation: BWA is cheaper than 87.65% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.84 | ||
| EV/EBITDA | 5.51 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.32
PEG (5Y)10.66
EPS Next 2Y7.2%
EPS Next 3Y7.6%
5. Dividend
5.1 Amount
BWA has a Yearly Dividend Yield of 1.59%. Purely for dividend investing, there may be better candidates out there.
BWA's Dividend Yield is comparable with the industry average which is at 4.43.
Compared to the average S&P500 Dividend Yield of 2.36, BWA is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.59% |
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
45.71% of the earnings are spent on dividend by BWA. This is a bit on the high side, but may be sustainable.
DP45.71%
EPS Next 2Y7.2%
EPS Next 3Y7.6%
42.59
-0.22 (-0.51%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupAutomobiles & Components
GICS IndustryAutomobile Components
Earnings (Last)
Earnings (Next)
Inst Owners103.57%
Inst Owner Change0%
Ins Owners1.03%
Ins Owner Change-3.87%
Market Cap9.22B
Analysts74.29
Price Target45.53 (6.9%)
Short Float %3.68%
Short Ratio3.46
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.59% |
Yearly Dividend0.44
Dividend Growth(5Y)-8.36%
DP45.71%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.58%
Min EPS beat(2)10.59%
Max EPS beat(2)12.56%
EPS beat(4)4
Avg EPS beat(4)11.14%
Min EPS beat(4)4.66%
Max EPS beat(4)16.74%
EPS beat(8)7
Avg EPS beat(8)9.53%
EPS beat(12)10
Avg EPS beat(12)10.93%
EPS beat(16)14
Avg EPS beat(16)13.96%
Revenue beat(2)1
Avg Revenue beat(2)1.04%
Min Revenue beat(2)-0.22%
Max Revenue beat(2)2.3%
Revenue beat(4)1
Avg Revenue beat(4)-0.47%
Min Revenue beat(4)-2.65%
Max Revenue beat(4)2.3%
Revenue beat(8)2
Avg Revenue beat(8)-1.36%
Revenue beat(12)4
Avg Revenue beat(12)-1.39%
Revenue beat(16)6
Avg Revenue beat(16)-3.17%
PT rev (1m)2.65%
PT rev (3m)15.58%
EPS NQ rev (1m)2.37%
EPS NQ rev (3m)11.08%
EPS NY rev (1m)0.52%
EPS NY rev (3m)6.54%
Revenue NQ rev (1m)0.81%
Revenue NQ rev (3m)3.75%
Revenue NY rev (1m)0.83%
Revenue NY rev (3m)2.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.64 | ||
| Fwd PE | 8.58 | ||
| P/S | 0.66 | ||
| P/FCF | 7.84 | ||
| P/OCF | 5.46 | ||
| P/B | 1.56 | ||
| P/tB | 3.05 | ||
| EV/EBITDA | 5.51 |
EPS(TTM)4.42
EY10.38%
EPS(NY)4.96
Fwd EY11.66%
FCF(TTM)5.43
FCFY12.75%
OCF(TTM)7.8
OCFY18.31%
SpS64.89
BVpS27.37
TBVpS13.98
PEG (NY)1.32
PEG (5Y)10.66
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.46% | ||
| ROE | 3.55% | ||
| ROCE | 11.88% | ||
| ROIC | 8.92% | ||
| ROICexc | 10.94% | ||
| ROICexgc | 16.13% | ||
| OM | 9.34% | ||
| PM (TTM) | 1.5% | ||
| GM | 18.65% | ||
| FCFM | 8.37% |
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-Score6
Asset Turnover0.98
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | 3.33 | ||
| Debt/EBITDA | 1.94 | ||
| Cap/Depr | 73.46% | ||
| Cap/Sales | 3.65% | ||
| Interest Coverage | 11.71 | ||
| Cash Conversion | 83.97% | ||
| Profit Quality | 559.52% | ||
| Current Ratio | 2.02 | ||
| Quick Ratio | 1.66 | ||
| Altman-Z | 2.87 |
F-Score6
WACC8.28%
ROIC/WACC1.08
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)7.8%
EPS 3Y1.35%
EPS 5Y0.9%
EPS Q2Q%1.68%
EPS Next Y7.31%
EPS Next 2Y7.2%
EPS Next 3Y7.6%
EPS Next 5Y6.26%
Revenue 1Y (TTM)-2.1%
Revenue growth 3Y-1.72%
Revenue growth 5Y6.74%
Sales Q2Q%0.97%
Revenue Next Year1.68%
Revenue Next 2Y2.43%
Revenue Next 3Y2.63%
Revenue Next 5Y4.17%
EBIT growth 1Y1.39%
EBIT growth 3Y-2.46%
EBIT growth 5Y1.39%
EBIT Next Year47.4%
EBIT Next 3Y16.81%
EBIT Next 5Y10.65%
FCF growth 1Y98.15%
FCF growth 3Y2.2%
FCF growth 5Y5.26%
OCF growth 1Y12.09%
OCF growth 3Y1.16%
OCF growth 5Y6.05%