BorgWarner (NYSE:BWA) Shares Gap Up After Earnings Beat

BorgWarner Inc. (NYSE:BWA)’s stock price gapped up prior to trading on Wednesday after the company announced better than expected quarterly earnings. The stock had previously closed at $32.45, but opened at $36.00. BorgWarner shares last traded at $35.26, with a volume of 403,568 shares.

The auto parts company reported $1.19 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.00 by $0.19. The firm had revenue of $3.60 billion during the quarter, compared to analyst estimates of $3.69 billion. BorgWarner had a net margin of 4.97% and a return on equity of 15.66%. BorgWarner’s quarterly revenue was down 20.3% on a year-over-year basis. During the same quarter in the prior year, the firm posted $1.35 earnings per share.

BorgWarner Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Monday, September 16th. Stockholders of record on Tuesday, September 3rd will be given a dividend of $0.11 per share. This represents a $0.44 dividend on an annualized basis and a dividend yield of 1.33%. The ex-dividend date of this dividend is Tuesday, September 3rd. BorgWarner’s dividend payout ratio is presently 16.67%.

BorgWarner announced that its Board of Directors has authorized a share buyback plan on Thursday, May 2nd that permits the company to repurchase $500.00 million in outstanding shares. This repurchase authorization permits the auto parts company to repurchase up to 6% of its stock through open market purchases. Stock repurchase plans are often a sign that the company’s management believes its shares are undervalued.

Analyst Upgrades and Downgrades

Several research firms recently weighed in on BWA. UBS Group boosted their target price on BorgWarner from $41.00 to $42.00 and gave the stock a “buy” rating in a research note on Wednesday, July 10th. JPMorgan Chase & Co. reduced their price target on shares of BorgWarner from $52.00 to $50.00 and set an “overweight” rating for the company in a research report on Monday, July 22nd. Robert W. Baird raised their price objective on BorgWarner from $38.00 to $39.00 and gave the stock a “neutral” rating in a report on Thursday. Citigroup reduced their target price on BorgWarner from $41.00 to $36.00 and set a “neutral” rating for the company in a report on Friday, July 12th. Finally, TD Cowen upped their target price on BorgWarner from $36.00 to $40.00 and gave the company a “buy” rating in a research report on Friday, May 3rd. Eight investment analysts have rated the stock with a hold rating and ten have assigned a buy rating to the company. Based on data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $41.35.

Institutional Trading of BorgWarner

A number of hedge funds have recently bought and sold shares of BWA. EdgeRock Capital LLC acquired a new position in shares of BorgWarner in the 4th quarter valued at $30,000. Riverview Trust Co acquired a new position in BorgWarner in the first quarter worth about $30,000. LRI Investments LLC lifted its stake in BorgWarner by 2,685.3% during the second quarter. LRI Investments LLC now owns 947 shares of the auto parts company’s stock worth $31,000 after purchasing an additional 913 shares during the period. Olistico Wealth LLC acquired a new stake in BorgWarner during the second quarter valued at approximately $35,000. Finally, Whittier Trust Co. of Nevada Inc. grew its stake in shares of BorgWarner by 12,144.4% in the 1st quarter. Whittier Trust Co. of Nevada Inc. now owns 1,102 shares of the auto parts company’s stock valued at $38,000 after purchasing an additional 1,093 shares during the period. 95.67% of the stock is owned by institutional investors.

BorgWarner Stock Performance

The company has a current ratio of 1.54, a quick ratio of 1.20 and a debt-to-equity ratio of 0.55. The firm has a market capitalization of $7.53 billion, a price-to-earnings ratio of 12.89, a PEG ratio of 0.81 and a beta of 1.22. The stock has a fifty day moving average price of $33.41 and a 200-day moving average price of $33.46.

About BorgWarner

BorgWarner Inc, together with its subsidiaries, provides solutions for combustion, hybrid, and electric vehicles worldwide. It offers turbochargers, eBoosters, eTurbos, timing systems, emissions systems, thermal systems, gasoline ignition technology, smart remote actuators, powertrain sensors, cabin heaters, battery modules and systems, battery heaters, and battery charging.