BorgWarner Inc. (BWA) Downgraded to “Hold” at Zacks Investment Research
Zacks Investment Research downgraded shares of BorgWarner Inc. (NYSE:BWA) from a buy rating to a hold rating in a research report sent to investors on Wednesday morning.
According to Zacks, “BorgWarner earnings and revenues beat the Zacks Consensus Estimate in the second quarter. Moreover, high organic net sales growth expectations are likely to aid BorgWarner going forward. Huge business opportunities in Asia, the Americas and Europe in the next three years are anticipated to contribute to a major portion of growth. Also, a healthy balance sheet and ample cash flow help the company to return capital to its shareholders’ and undertake acquisitions. However, its inability to pass on any rise in raw materials to OEMs, is adversely impacting its profit. Moreover, foreign currency fluctuations and business divestitures are other headwinds BorgWarner has been facing. Also year-to-date, its share has underperformed the industry it belongs to.”
BWA has been the subject of a number of other reports. BMO Capital Markets reaffirmed an outperform rating and issued a $55.00 price objective (up from $50.00) on shares of BorgWarner in a research report on Friday, July 28th. Bank of America Corporation reaffirmed an underperform rating and issued a $27.00 price objective (down from $30.00) on shares of BorgWarner in a research report on Friday, June 16th. Jefferies Group LLC reaffirmed a buy rating and issued a $56.00 price objective on shares of BorgWarner in a research report on Tuesday. Morgan Stanley cut their price objective on BorgWarner from $34.00 to $32.00 and set an underweight rating for the company in a research report on Friday, June 9th. Finally, ValuEngine cut BorgWarner from a strong-buy rating to a buy rating in a research report on Friday, June 2nd. Three investment analysts have rated the stock with a sell rating, nine have assigned a hold rating and six have given a buy rating to the company’s stock. BorgWarner currently has a consensus rating of Hold and an average target price of $43.20.
Shares of BorgWarner (NYSE:BWA) opened at 44.78 on Wednesday. The firm has a market cap of $9.45 billion, a P/E ratio of 49.92 and a beta of 1.73. The company’s 50-day moving average is $45.61 and its 200-day moving average is $42.58. BorgWarner has a 52-week low of $33.09 and a 52-week high of $48.03.
BorgWarner (NYSE:BWA) last released its quarterly earnings data on Thursday, July 27th. The auto parts company reported $0.96 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $0.89 by $0.07. BorgWarner had a return on equity of 20.75% and a net margin of 2.06%. The company had revenue of $2.39 billion during the quarter, compared to analysts’ expectations of $2.27 billion. During the same period last year, the firm posted $0.84 earnings per share. The business’s revenue was up 2.5% on a year-over-year basis. Equities research analysts forecast that BorgWarner will post $3.70 earnings per share for the current fiscal year.
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The firm also recently declared a quarterly dividend, which will be paid on Friday, September 15th. Stockholders of record on Friday, September 1st will be paid a $0.14 dividend. The ex-dividend date of this dividend is Wednesday, August 30th. This represents a $0.56 annualized dividend and a dividend yield of 1.25%. BorgWarner’s payout ratio is 62.92%.
In other news, insider Brady D. Ericson sold 11,052 shares of BorgWarner stock in a transaction on Wednesday, August 16th. The stock was sold at an average price of $45.38, for a total value of $501,539.76. Following the transaction, the insider now owns 23,418 shares in the company, valued at approximately $1,062,708.84. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Also, Director Dennis C. Cuneo sold 1,000 shares of BorgWarner stock in a transaction on Tuesday, June 13th. The shares were sold at an average price of $44.06, for a total value of $44,060.00. Following the completion of the transaction, the director now owns 13,398 shares in the company, valued at approximately $590,315.88. The disclosure for this sale can be found here. In the last quarter, insiders sold 15,052 shares of company stock worth $680,570. Corporate insiders own 0.66% of the company’s stock.
Several institutional investors have recently modified their holdings of BWA. Heartland Advisors Inc. acquired a new position in shares of BorgWarner during the first quarter valued at about $4,109,000. Mitsubishi UFJ Kokusai Asset Management Co. Ltd. increased its stake in BorgWarner by 3.0% in the first quarter. Mitsubishi UFJ Kokusai Asset Management Co. Ltd. now owns 34,081 shares of the auto parts company’s stock valued at $1,424,000 after buying an additional 1,007 shares during the period. Canada Pension Plan Investment Board increased its stake in BorgWarner by 102.5% in the first quarter. Canada Pension Plan Investment Board now owns 36,530 shares of the auto parts company’s stock valued at $1,527,000 after buying an additional 18,489 shares during the period. Oregon Public Employees Retirement Fund increased its stake in BorgWarner by 31.1% in the first quarter. Oregon Public Employees Retirement Fund now owns 56,897 shares of the auto parts company’s stock valued at $2,378,000 after buying an additional 13,500 shares during the period. Finally, Sumitomo Mitsui Asset Management Company LTD increased its stake in BorgWarner by 9.9% in the first quarter. Sumitomo Mitsui Asset Management Company LTD now owns 20,625 shares of the auto parts company’s stock valued at $861,000 after buying an additional 1,850 shares during the period. Institutional investors own 91.06% of the company’s stock.
BorgWarner Company Profile
BorgWarner Inc is engaged in providing technology solutions for combustion, hybrid and electric vehicles. The Company’s segments include Engine and Drivetrain. The Engine segment’s products include turbochargers, timing devices and chains, emissions systems and thermal systems. The Engine segment develops and manufactures products for gasoline and diesel engines, and alternative powertrains.
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