BORGWARNER INC (BWA)

US0997241064 - Common Stock

30.41  -0.1 (-0.33%)

After market: 30.41 0 (0%)

Fundamental Rating

5

Overall BWA gets a fundamental rating of 5 out of 10. We evaluated BWA against 42 industry peers in the Automobile Components industry. Both the profitability and the financial health of BWA get a neutral evaluation. Nothing too spectacular is happening here. BWA is cheap, but on the other hand it scores bad on growth.



5

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.
Each year in the past 5 years BWA has been profitable.
In the past 5 years BWA always reported a positive cash flow from operatings.

1.2 Ratios

The Return On Assets of BWA (4.32%) is better than 71.43% of its industry peers.
Looking at the Return On Equity, with a value of 10.72%, BWA is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
The Return On Invested Capital of BWA (8.73%) is better than 71.43% of its industry peers.
Industry RankSector Rank
ROA 4.32%
ROE 10.72%
ROIC 8.73%
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A

1.3 Margins

With a decent Profit Margin value of 4.40%, BWA is doing good in the industry, outperforming 73.81% of the companies in the same industry.
In the last couple of years the Profit Margin of BWA has declined.
With a decent Operating Margin value of 8.90%, BWA is doing good in the industry, outperforming 78.57% of the companies in the same industry.
BWA's Operating Margin has declined in the last couple of years.
BWA has a Gross Margin (18.09%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of BWA has declined.
Industry RankSector Rank
OM 8.9%
PM (TTM) 4.4%
GM 18.09%
OM growth 3Y-0.75%
OM growth 5Y-6.17%
PM growth 3Y-3.63%
PM growth 5Y-13.02%
GM growth 3Y-1.26%
GM growth 5Y-3.1%

4

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so BWA is destroying value.
There is no outstanding debt for BWA. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.

2.2 Solvency

An Altman-Z score of 2.57 indicates that BWA is not a great score, but indicates only limited risk for bankruptcy at the moment.
BWA's Altman-Z score of 2.57 is fine compared to the rest of the industry. BWA outperforms 64.29% of its industry peers.
BWA has a debt to FCF ratio of 7.88. This is a slightly negative value and a sign of low solvency as BWA would need 7.88 years to pay back of all of its debts.
BWA has a Debt to FCF ratio of 7.88. This is comparable to the rest of the industry: BWA outperforms 54.76% of its industry peers.
BWA has a Debt/Equity ratio of 0.65. This is a neutral value indicating BWA is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.65, BWA is doing worse than 69.05% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.65
Debt/FCF 7.88
Altman-Z 2.57
ROIC/WACC0.82
WACC10.6%

2.3 Liquidity

A Current Ratio of 1.65 indicates that BWA should not have too much problems paying its short term obligations.
BWA's Current ratio of 1.65 is in line compared to the rest of the industry. BWA outperforms 40.48% of its industry peers.
BWA has a Quick Ratio of 1.30. This is a normal value and indicates that BWA is financially healthy and should not expect problems in meeting its short term obligations.
BWA has a better Quick ratio (1.30) than 66.67% of its industry peers.
Industry RankSector Rank
Current Ratio 1.65
Quick Ratio 1.3

3

3. Growth

3.1 Past

The earnings per share for BWA have decreased by -6.09% in the last year.
Measured over the past years, BWA shows a decrease in Earnings Per Share. The EPS has been decreasing by -0.77% on average per year.
Looking at the last year, BWA shows a small growth in Revenue. The Revenue has grown by 5.75% in the last year.
BWA shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.16% yearly.
EPS 1Y (TTM)-6.09%
EPS 3Y17.11%
EPS 5Y-0.77%
EPS growth Q2Q-28.57%
Revenue 1Y (TTM)5.75%
Revenue growth 3Y11.78%
Revenue growth 5Y6.16%
Revenue growth Q2Q-14.26%

3.2 Future

The Earnings Per Share is expected to grow by 7.11% on average over the next years.
The Revenue is expected to grow by 7.03% on average over the next years.
EPS Next Y-0.11%
EPS Next 2Y6.09%
EPS Next 3Y8.61%
EPS Next 5Y7.11%
Revenue Next Year5.12%
Revenue Next 2Y6.55%
Revenue Next 3Y7.76%
Revenue Next 5Y7.03%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.

7

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 7.04, the valuation of BWA can be described as very cheap.
Based on the Price/Earnings ratio, BWA is valued cheaply inside the industry as 92.86% of the companies are valued more expensively.
BWA is valuated cheaply when we compare the Price/Earnings ratio to 26.35, which is the current average of the S&P500 Index.
BWA is valuated cheaply with a Price/Forward Earnings ratio of 7.05.
Compared to the rest of the industry, the Price/Forward Earnings ratio of BWA indicates a rather cheap valuation: BWA is cheaper than 92.86% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.63, BWA is valued rather cheaply.
Industry RankSector Rank
PE 7.04
Fwd PE 7.05

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, BWA is valued cheaper than 83.33% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of BWA indicates a somewhat cheap valuation: BWA is cheaper than 64.29% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 14.89
EV/EBITDA 5.07

4.3 Compensation for Growth

PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y6.09%
EPS Next 3Y8.61%

6

5. Dividend

5.1 Amount

BWA has a Yearly Dividend Yield of 1.40%. Purely for dividend investing, there may be better candidates out there.
BWA's Dividend Yield is a higher than the industry average which is at 2.71.
With a Dividend Yield of 1.40, BWA pays less dividend than the S&P500 average, which is at 2.46.
Industry RankSector Rank
Dividend Yield 1.4%

5.2 History

The dividend of BWA has a limited annual growth rate of 2.97%.
BWA has paid a dividend for at least 10 years, which is a reliable track record.
As BWA did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)2.97%
Div Incr Years0
Div Non Decr Years9

5.3 Sustainability

BWA pays out 20.80% of its income as dividend. This is a sustainable payout ratio.
The dividend of BWA is growing, but earnings are growing more, so the dividend growth is sustainable.
DP20.8%
EPS Next 2Y6.09%
EPS Next 3Y8.61%

BORGWARNER INC

NYSE:BWA (2/23/2024, 7:04:01 PM)

After market: 30.41 0 (0%)

30.41

-0.1 (-0.33%)

Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupAutomobiles & Components
GICS IndustryAutomobile Components
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap7.15B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 1.4%
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 7.04
Fwd PE 7.05
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 4.32%
ROE 10.72%
ROCE
ROIC
ROICexc
ROICexgc
OM 8.9%
PM (TTM) 4.4%
GM 18.09%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.98
Health
Industry RankSector Rank
Debt/Equity 0.65
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 1.65
Quick Ratio 1.3
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-6.09%
EPS 3Y17.11%
EPS 5Y
EPS growth Q2Q
EPS Next Y-0.11%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)5.75%
Revenue growth 3Y11.78%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y