BORGWARNER INC (BWA) Stock Fundamental Analysis
USA - NYSE:BWA - US0997241064 - Common Stock
43.7 USD
-0.66 (-1.49%)
43.7 USD
0 (0%)
BWA gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 80 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 is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
BWA had positive earnings in the past year.
BWA had a positive operating cash flow in the past year.
In the past 5 years BWA has always been profitable.
In the past 5 years BWA always reported a positive cash flow from operatings.
1.2 Ratios
BWA has a Return On Assets of 1.46%. This is in the lower half of the industry: BWA underperforms 72.50% of its industry peers.
Looking at the Return On Equity, with a value of 3.55%, BWA is doing worse than 70.00% of the companies in the same industry.
With an excellent Return On Invested Capital value of 8.92%, BWA belongs to the best of the industry, outperforming 90.00% of the companies in the same industry.
BWA had an Average Return On Invested Capital over the past 3 years of 8.99%. This 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
Looking at the Profit Margin, with a value of 1.50%, BWA is doing worse than 71.25% of the companies in the same industry.
BWA's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 9.34%, BWA is in line with its industry, outperforming 42.50% of the companies in the same industry.
BWA's Operating Margin has declined in the last couple of years.
The Gross Margin of BWA (18.65%) is worse than 76.25% of its industry peers.
In the last couple of years the Gross Margin of BWA has declined.
| 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.
Compared to 5 years ago, BWA has more shares outstanding
The debt/assets ratio for BWA is higher compared to a year ago.
2.2 Solvency
BWA has an Altman-Z score of 2.89. This is not the best score and indicates that BWA is in the grey zone with still only limited risk for bankruptcy at the moment.
BWA has a Altman-Z score of 2.89. This is in the better half of the industry: BWA outperforms 63.75% of its industry peers.
BWA has a debt to FCF ratio of 3.33. This is a good value and a sign of high solvency as BWA would need 3.33 years to pay back of all of its debts.
BWA has a better Debt to FCF ratio (3.33) than 90.00% of its industry peers.
A Debt/Equity ratio of 0.66 indicates that BWA is somewhat dependend on debt financing.
BWA has a Debt to Equity ratio of 0.66. This is in the lower half of the industry: BWA underperforms 77.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | 3.33 | ||
| Altman-Z | 2.89 |
ROIC/WACC1.02
WACC8.72%
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 75.00% 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.
The Quick ratio of BWA (1.66) is better than 85.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.02 | ||
| Quick Ratio | 1.66 |
3. Growth
3.1 Past
BWA shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.80%.
The Earnings Per Share has been growing slightly by 0.90% on average over the past years.
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
BWA is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.26% yearly.
Based on estimates for the next years, BWA will show a small growth in Revenue. The Revenue will grow by 4.17% on average per year.
EPS Next Y6.76%
EPS Next 2Y7.08%
EPS Next 3Y7.58%
EPS Next 5Y6.26%
Revenue Next Year0.84%
Revenue Next 2Y1.76%
Revenue Next 3Y2.44%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 9.89, the valuation of BWA can be described as reasonable.
77.50% of the companies in the same industry are more expensive than BWA, based on the Price/Earnings ratio.
BWA is valuated cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 8.82, the valuation of BWA can be described as very reasonable.
BWA's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. BWA is cheaper than 68.75% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of BWA to the average of the S&P500 Index (22.73), we can say BWA is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.89 | ||
| Fwd PE | 8.82 |
4.2 Price Multiples
65.00% of the companies in the same industry are more expensive than BWA, based on the Enterprise Value to EBITDA ratio.
87.50% of the companies in the same industry are more expensive than BWA, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.05 | ||
| EV/EBITDA | 5.63 |
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)1.46
PEG (5Y)10.94
EPS Next 2Y7.08%
EPS Next 3Y7.58%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.53%, BWA has a reasonable but not impressive dividend return.
BWA's Dividend Yield is comparable with the industry average which is at 3.89.
Compared to the average S&P500 Dividend Yield of 2.38, BWA is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.53% |
5.2 History
The dividend of BWA decreases each year by -8.36%.
BWA has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)-8.36%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
BWA pays out 45.71% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP45.71%
EPS Next 2Y7.08%
EPS Next 3Y7.58%
43.7
-0.66 (-1.49%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupAutomobiles & Components
GICS IndustryAutomobile Components
Earnings (Last)
Earnings (Next)
Inst Owners103.55%
Inst Owner Change-2.78%
Ins Owners1.06%
Ins Owner Change-3.87%
Market Cap9.46B
Analysts75.45
Price Target44.36 (1.51%)
Short Float %3.41%
Short Ratio3.29
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.53% |
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)6.53%
PT rev (3m)18.31%
EPS NQ rev (1m)0.83%
EPS NQ rev (3m)7.12%
EPS NY rev (1m)5.99%
EPS NY rev (3m)6.05%
Revenue NQ rev (1m)0.17%
Revenue NQ rev (3m)2.92%
Revenue NY rev (1m)0.95%
Revenue NY rev (3m)2.42%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.89 | ||
| Fwd PE | 8.82 | ||
| P/S | 0.67 | ||
| P/FCF | 8.05 | ||
| P/OCF | 5.61 | ||
| P/B | 1.6 | ||
| P/tB | 3.13 | ||
| EV/EBITDA | 5.63 |
EPS(TTM)4.42
EY10.11%
EPS(NY)4.95
Fwd EY11.33%
FCF(TTM)5.43
FCFY12.43%
OCF(TTM)7.8
OCFY17.84%
SpS64.89
BVpS27.37
TBVpS13.98
PEG (NY)1.46
PEG (5Y)10.94
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 | 2.89 |
F-Score6
WACC8.72%
ROIC/WACC1.02
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 Y6.76%
EPS Next 2Y7.08%
EPS Next 3Y7.58%
EPS Next 5Y6.26%
Revenue 1Y (TTM)-2.1%
Revenue growth 3Y-1.72%
Revenue growth 5Y6.74%
Sales Q2Q%0.97%
Revenue Next Year0.84%
Revenue Next 2Y1.76%
Revenue Next 3Y2.44%
Revenue Next 5Y4.17%
EBIT growth 1Y1.39%
EBIT growth 3Y-2.46%
EBIT growth 5Y1.39%
EBIT Next Year44.55%
EBIT Next 3Y16.7%
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%