In the latest trading session, BorgWarner (BWA) closed at $45.65, marking a +0.55% move from the previous day. This move lagged the S&P 500’s daily gain of 0.71%. Meanwhile, the Dow gained 1.06%, and the Nasdaq, a tech-heavy index, added 4.62%.
Heading into today, shares of the auto parts supplier had lost 6.58% over the past month, lagging the Auto-Tires-Trucks sector’s gain of 22.6% and the S&P 500’s gain of 2.65% in that time.
BorgWarner will be looking to display strength as it nears its next earnings release, which is expected to be August 2, 2023. The company is expected to report EPS of $1.14, up 8.57% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.3 billion, up 14.49% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.72 per share and revenue of $17.38 billion. These totals would mark changes of +2.61% and +10.02%, respectively, from last year.
Any recent changes to analyst estimates for BorgWarner should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 4.95% lower. BorgWarner currently has a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that BorgWarner has a Forward P/E ratio of 9.62 right now. For comparison, its industry has an average Forward P/E of 15.46, which means BorgWarner is trading at a discount to the group.
Also, we should mention that BWA has a PEG ratio of 0.68. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. The Automotive – Original Equipment was holding an average PEG ratio of 0.68 at yesterday’s closing price.
The Automotive – Original Equipment industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 163, putting it in the bottom 36% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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BorgWarner Inc. (BWA) : Free Stock Analysis Report