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BorgWarner
(NYSE:BWA)
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Rating:60Neutral
Price Target:
$59.00
â–¼(-8.80% Downside)
Action:Reiterated
Date:10/29/26
The score reflects solid financial stability led by strong free cash flow and reasonable leverage, reinforced by a positive earnings update with maintained margin outlook and higher EPS guidance. These strengths are tempered by clearly bearish technical signals and only middling valuation support given the higher P/E and modest dividend yield.
Positive Factors
Strong Cash Generation
BorgWarner’s substantial operating and free cash flow provides internal funding for product development, debt management, and shareholder returns. Strong cash generation also improves resilience through automotive cycles and supports the company’s ability to invest in electrification and industrial opportunities without relying solely on external financing.
Negative Factors
Sales and Battery Headwinds
The expected organic sales decline signals near-term pressure on the company’s revenue base, while the battery-business contraction shows that electrification exposure is not uniformly favorable. Continued weakness could limit operating leverage and make growth dependent on recovery in vehicle production and newer programs.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong Cash Generation
BorgWarner’s substantial operating and free cash flow provides internal funding for product development, debt management, and shareholder returns. Strong cash generation also improves resilience through automotive cycles and supports the company’s ability to invest in electrification and industrial opportunities without relying solely on external financing.
Read all positive factors
BorgWarner Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyBorgWarner (BWA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.39B
Dividend Yield1.22%
Average Volume (3M)2.79M
Price to Earnings (P/E)27.7
Beta (1Y)0.68
Revenue Growth2.17%
EPS Growth111.19%
CountryUS
Employees37,500
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Parts
Share Statistics
EPS (TTM)2.39
Shares Outstanding203,666,350
10 Day Avg. Volume2,927,635
30 Day Avg. Volume2,786,378
Financial Highlights & Ratios
PEG Ratio-2.40
Price to Book (P/B)1.77
Price to Sales (P/S)0.67
P/FCF Ratio7.99
Enterprise Value/Market Cap1.36
Enterprise Value/Revenue1.09
Enterprise Value/Gross Profit5.55
Enterprise Value/Ebitda12.77
Forecast
1Y Price Target
$83.18Price Target Upside28.59% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
EPS Forecast (FY)5.21
Revenue Forecast (FY)$14.20B
BorgWarner Business Overview & Revenue Model
Company Description
BorgWarner Inc. (BWA) is a prominent global supplier of advanced propulsion technologies, catering to a wide spectrum of vehicles including those powered by internal combustion engines, hybrids, and fully electric drivetrains. The company's operat...
How the Company Makes Money
BorgWarner makes money primarily by selling automotive components and systems to vehicle OEMs (and, to a lesser extent, the aftermarket) under customer supply agreements tied to vehicle production programs. Revenue is generated when BorgWarner del...
BorgWarner Earnings Call Summary
Earnings Call Date:Oct 29, 2026
(Q3-2026)
| Next Earnings Date:Feb 11, 2027
Earnings Call Sentiment Positive
The call was strongly positive overall. BorgWarner delivered higher margins and EPS, 33% eProduct growth, nine new business awards, strong free cash flow, substantial shareholder returns, and continued progress in data center and industrial initiatives. These positives outweighed lower overall sales, battery-business weakness, declining market production, input-cost inflation, and limited near-term visibility for some industrial programs.Positive Updates
Strong Third-Quarter Profitability Despite Lower Production
Third-quarter sales were just under $3.5 billion. Adjusted operating margin expanded 20 basis points to 10.9% from 10.7% a year ago, while adjusted EPS increased 12%, or $0.15, despite a declining production environment. Management attributed the result to ongoing cost-reduction actions.
Negative Updates
Overall Organic Sales Decline
The remaining organic sales decrease was $58 million, or 1.6% year over year, roughly in line with the decline in light vehicle market production. Excluding foreign-exchange effects, adjusted operating income decreased $6 million on $112 million of lower sales.
Read all updates
Q3-2026 Updates
Positive
Negative
Strong Third-Quarter Profitability Despite Lower Production
Third-quarter sales were just under $3.5 billion. Adjusted operating margin expanded 20 basis points to 10.9% from 10.7% a year ago, while adjusted EPS increased 12%, or $0.15, despite a declining production environment. Management attributed the result to ongoing cost-reduction actions.
Read all positive updates
Company Guidance
For 2026, BorgWarner expects total sales in the range of $14.0 billion to $14.2 billion, a full-year sales benefit of EUR 250 million from foreign currencies, weighted end markets down 1% to 2%, organic sales change down 4% to down 2.5% year-over-year, and a battery-business decline representing roughly 170 basis point headwind to year-over-year sales growth; adjusted operating margin is expected in the range of 10.7% to 10.9%, including a $10 million to $15 million industrial R&D investment, adjusted EPS is expected in the range of $5.20 to $5.35 per diluted share, and free cash flow is expected in the range of $900 million to $1.1 billion. For Q4, revenue is expected to be closer to $3.43 billion, with a decrement in the mid-teens and $10 million in industrial R&D. For 2027, the company expects modest growth over market in its automotive business, $300 million of turbine generator revenue, and mid-teens conversion of extra growth.BorgWarner Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
62
Positive
Cash Flow
74
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 14.24B | 14.32B | 14.08B | 14.20B | 12.63B | 14.84B |
| Gross Profit | 2.79B | 2.67B | 2.61B | 2.57B | 2.37B | 2.86B |
| EBITDA | 1.21B | 1.28B | 1.32B | 1.67B | 1.56B | 1.49B |
| Net Income | 478.00M | 277.00M | 338.00M | 625.00M | 944.00M | 537.00M |
Balance Sheet | ||||||
| Total Assets | 13.22B | 13.77B | 13.99B | 14.45B | 16.99B | 16.57B |
| Cash, Cash Equivalents and Short-Term Investments | 1.58B | 2.31B | 2.09B | 1.53B | 1.08B | 1.84B |
| Total Debt | 3.01B | 4.06B | 4.34B | 3.93B | 4.31B | 4.52B |
| Total Liabilities | 7.35B | 8.15B | 8.29B | 8.39B | 9.49B | 9.31B |
| Stockholders Equity | 5.67B | 5.44B | 5.53B | 5.83B | 7.22B | 6.95B |
Cash Flow | ||||||
| Free Cash Flow | 1.54B | 1.21B | 681.00M | 477.00M | 948.00M | 791.00M |
| Operating Cash Flow | 1.68B | 1.65B | 1.35B | 1.31B | 1.57B | 1.31B |
| Investing Cash Flow | -462.00M | -368.00M | -603.00M | -694.00M | -1.42B | -1.43B |
| Financing Cash Flow | -1.81B | -1.12B | -167.00M | -419.00M | -567.00M | 319.00M |
BorgWarner Technical Analysis
Negative
64.69
Price Trends
61.81
Negative
64.34
Negative
60.36
Negative
Market Momentum
-1.85
Positive
34.90
Neutral
35.67
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BWA, the sentiment is Negative. The current price of 64.69 is above the 20-day moving average (MA) of 58.86, above the 50-day MA of 61.81, and above the 200-day MA of 60.36, indicating a bearish trend. The MACD of -1.85 indicates Positive momentum. The RSI at 34.90 is Neutral, neither overbought nor oversold. The STOCH value of 35.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BWA.
BorgWarner Risk Analysis
BorgWarner disclosed 37 risk factors in its most recent earnings report. BorgWarner reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
BorgWarner Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $5.77B | 10.85 | 10.90% | 2.63% | 3.55% | 25.67% | |
67 Neutral | $8.32B | 13.81 | 24.54% | 3.01% | 4.26% | -13.85% | |
66 Neutral | $9.03B | 17.24 | 27.88% | 1.04% | 37.56% | -28.71% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $11.39B | 27.69 | 7.37% | 1.22% | 2.17% | 111.19% | |
53 Neutral | $2.74B | -12.31 | -16.24% | 1.94% | -8.85% | -374.41% | |
53 Neutral | $9.15B | 41.98 | 2.41% | 0.97% | -5.40% | -75.68% |
* Consumer Cyclical Sector Average
BWA
BorgWarner
55.93
13.61
32.16%
ALSN
Allison Transmission Holdings
109.30
28.57
35.38%
ALV
Autoliv
115.55
2.80
2.48%
DAN
Dana Incorporated
25.48
4.26
20.09%
APTV
Aptiv
44.08
-28.58
-39.33%
LEA
Lear
116.89
15.38
15.15%
BorgWarner Corporate Events
Business Operations and Strategy
BorgWarner Confirms 2027 Turbine Generator Growth Plan
Positive
Sep 4, 2026
BorgWarner Inc. has reiterated that it expects turbine generator production to commence in 2027 at its planned facility in Hendersonville, North Carolina, with an initial installed capacity of 2 GW. The company continues to project first-year turb...
Business Operations and StrategyPrivate Placements and Financing
BorgWarner Announces Debt Tender Offers and Redemption Plan
Positive
Aug 10, 2026
On August 10, 2026, BorgWarner Inc. launched cash tender offers for any and all of its 7.125% Senior Notes due 2029, along with up to $720 million of several other series of senior notes maturing between 2027 and 2045. The offers use a waterfall s...
Business Operations and StrategyExecutive/Board ChangesDividends
BorgWarner Adds Independent Director, Maintains Quarterly Dividend
Positive
Jul 31, 2026
On July 30, 2026, BorgWarner’s board expanded from eight to nine members and appointed former Deere Company executive Rajesh Kalathur as an independent director, with his compensation set under the company’s standard non‑employe...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.