Don't overlook NYSE:BWA—it's a hidden gem with strong fundamentals and an attractive price tag.

Last update: Nov 17, 2023

Uncover the potential of BORGWARNER INC (NYSE:BWA) as our stock screener's choice for an undervalued stock. NYSE:BWA maintains a strong financial position and offers an appealing valuation. We'll delve into the specifics below.

Valuation Assessment of NYSE:BWA

ChartMill assigns a Valuation Rating to every stock. This score ranges from 0 to 10 and evaluates the different valuation aspects and compares the price to earnings and cash flows, while taking into account profitability and growth. NYSE:BWA scores a 7 out of 10:

With a Price/Earnings ratio of 7.23, the valuation of BWA can be described as very cheap.
Based on the Price/Earnings ratio, BWA is valued cheaper than 92.86% of the companies in the same industry.
BWA is valuated cheaply when we compare the Price/Earnings ratio to 24.73, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 7.68 indicates a rather cheap valuation of BWA.
BWA's Price/Forward Earnings ratio is rather cheap when compared to the industry. BWA is cheaper than 88.10% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 19.36, BWA is valued rather cheaply.
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of BWA indicates a rather cheap valuation: BWA is cheaper than 88.10% of the companies listed 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.
The decent profitability rating of BWA may justify a higher PE ratio.

How do we evaluate the Profitability for NYSE:BWA?

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:BWA scores a 7 out of 10:

The Return On Assets of BWA (6.69%) is better than 80.95% of its industry peers.
Looking at the Return On Equity, with a value of 16.35%, BWA belongs to the top of the industry, outperforming 83.33% of the companies in the same industry.
The Return On Invested Capital of BWA (12.96%) is better than 88.10% of its industry peers.
The last Return On Invested Capital (12.96%) for BWA is above the 3 year average (7.97%), which is a sign of increasing profitability.
BWA's Profit Margin of 4.97% is fine compared to the rest of the industry. BWA outperforms 76.19% of its industry peers.
BWA's Profit Margin has improved in the last couple of years.
BWA has a better Operating Margin (9.12%) than 78.57% of its industry peers.

Analyzing Health Metrics

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NYSE:BWA was assigned a score of 5 for health:

BWA has an Altman-Z score of 3.12. This indicates that BWA is financially healthy and has little risk of bankruptcy at the moment.
BWA has a Altman-Z score of 3.12. This is in the better half of the industry: BWA outperforms 73.81% of its industry peers.
Looking at the Quick ratio, with a value of 1.28, BWA is in the better half of the industry, outperforming 64.29% of the companies in the same industry.

Growth Assessment of NYSE:BWA

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NYSE:BWA, the assigned 5 reflects its growth potential:

BWA shows a strong growth in Revenue. In the last year, the Revenue has grown by 23.56%.
BWA shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 10.03% yearly.

Our Decent Value screener lists more Decent Value stocks and is updated daily.

For an up to date full fundamental analysis you can check the fundamental report of BWA

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.