BorgWarner (BGW) AI Stock Analysis

BorgWarner

(Frankfurt:BGW)

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Positive Factors

Strong Cash GenerationBorgWarner’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 HeadwindsThe 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.

BorgWarner (BGW) vs. iShares MSCI Germany ETF (EWG)

Market Cap: EUR 10.39B
Dividend Yield: 1.17%
Average Volume (3M): 78
Price to Earnings (P/E): 21.7
Beta (1Y): 0.25
Revenue Growth: -4.57%
EPS Growth: 312.20%
Country: Germany
Employees: 37,500
Sector: General
Sector Strength: 55
Industry: Auto - Parts

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 operation...

BorgWarner Earnings Call Summary

Earnings Call Date:Oct 28, 2026(Q3-2026)|% Change Since:0.60%|Next Earnings Date:Feb 10, 2027

Earnings Call SentimentPositive

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.

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 Risk Analysis

BorgWarner disclosed 37 risk factors in its most recent earnings report. BorgWarner reported the most risks in the "Production" category.

Production - Risks related to the company’s ability to manufacture goods and services

Latest Risks Added

0 New Risks

BorgWarner Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

DE:BGW against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ALSN	71Outperform	$8.92B	10.73	27.88%	1.01%	37.56%	-28.71%
LEA	69Neutral	$5.84B	10.65	11.52%	2.52%	3.52%	40.59%
ALV	67Neutral	$8.46B	14.66	24.54%	2.84%	4.26%	-13.85%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
DAN	53Neutral	$2.49B	-11.06	-16.24%	2.01%	-8.85%	-374.41%
APTV	48Neutral	$9.12B	42.12	2.41%	―	-5.40%	-75.68%

* General Sector Average

Performance Comparison

DE:BGW and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
DE:BGW	Borgwarner Inc	50.08	12.92	34.77%
ALSN	Allison Transmission	113.09	34.52	43.94%
ALV	Autoliv	122.70	6.54	5.63%
DAN	Dana Incorporated	22.89	2.68	13.24%
APTV	Aptiv PLC	44.23	-24.26	-35.42%
LEA	Lear Corp.	122.29	18.26	17.55%

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.

BorgWarner AI Stock Analysis